I was at a conference on Saturday when the Asst Sec of HHS in California and the former sec of HHS in Massachusetts managed to twist their tongues around how they were getting to mandates, with shared responsibility, provider contributions, employers cost-sharing, blah blah blah—and never a mention of a thing starting with T and ending with an ax.
John Edwards has decided to be brave and say that he can insure the uninsured with just that—a tax raise. Brave man. Foolhardy, perhaps! Especially as there’s plenty of money in the system now to do it—with just a little bit of redistribution (which Schwarzenegger is also pointing out).
At any rate the vaunted National Federation of Independent Business is out with its head firmly stuck up its rear. So perhaps he’s doing something right.
The National Federation of Independent Business, a powerful lobby that represents small-business owners, said such mandates amounted to a job-killing tax on small companies. “Health care mandates are a nonstarter for our members,” said Stephanie Cathcart, a spokeswoman for the federation.
I’ve said in polite terms what I think about the NFIB’s logic over at Spot-on a while back. Basically their members just can’t add up.
So now it’s time to be a little more direct. The best way to do this is perhaps to let you in on a little email chat with one of their number who thought that I would support his quest to get the Shaddeg bill into law. Clearly not a man who knows his audience. Here goes:
From: Ragley, Jay [mailto:Jay.Ragley@nfib.org] Sent: Wednesday, December 20, 2006 1:23 PMTo: firstname.lastname@example.orgSubject: Small Business Health Insurance EditorialTo Whom It May Concern at The Health Care Blog:
I don’t know if you link to published editorials, but I would submit the following editorial on some ideas our organization and our members are beginning to suggest in South Carolina. If you choose to link it, I appreciate it and if not, I appreciate your consideration.
(Link to pro-AHP/Shaddeg bill article, which I didn’t link to—surprise surprise—whatever Eric Novack would like me to do!)
Jay W. Ragley
State DirectorNFIB/South Carolina
So I wrote back:
From: Matthew Holt [mailto:email@example.com] Sent: Wed 12/20/2006 4:59 PM To: Ragley, Jay Cc: Subject: RE: Small Business Health Insurance Editorial
You’re kidding right? Have you ever read THCB? I think that the NFIB is so, so dumb about this issue that it’s unbelievable. NFIB members offering health insurance are the group that would benefit the MOST from a national health insurance single payer scheme, and yet you insist on getting behind ridiculous solutions that make matters worse and will continue the cost escalation with no controls that cause the problem.
I’ve written about this here http://www.spot-on.com/archives/holt/2006/05/small_businesses_that_cant_do.html#more and I’m not going to berate you further. but I do invite you to respond to my basic assessment of why your position is so wrong for your own members.
All the best
To which he gamely responded.
From: Ragley, Jay [mailto:Jay.Ragley@nfib.org] Sent: Wednesday, December 20, 2006 4:12 PMTo: firstname.lastname@example.orgSubject: RE: Small Business Health Insurance Editorial
Thanks for your response. I did read some of your blog but obviously not enough. I’m new to NFIB and have been trying to work more with bloggers as most of the MSM don’t care about small business issues. I’m not aware of any health insurance blogs in South Carolina (mostly political ones down here).
I did read the blog posting you sent me and I hope you understand how NFIB determines its public policy positions. We send ballots to our members throughout the year on a variety of issues. So, when NFIB supports repealing the death tax, it’s because a strong majority of our members (not a 51% majority) support that position. So believe it or not, it is the small business membership of NFIB that determines our public policy positions.
But as far as a single-payer system, I will ask the same question I asked folks when I worked in DC. As a supporter of single-payer system, can you claim with any degree of confidence that a government-run health insurance system will not bankrupt the government, the economy or both as we know it in the USA? Whatever tax you choose to impose to pay for this system will, in all likelihood, lead to lower economic growth, which will lead to lower tax revenues and thus produce deficits, assuming that all other government spending is held constant (a big assumption given the recent spending increases in many government programs besides health care). So the economy will sour to a degree, the treasury will collect less revenue and the government will have to a) borrow b) cut spending c) raise taxes again. Seems to me the most likely scenario is raise taxes, which will only exacerbate the problem. There is no free lunch.
So unless the single-payer crowd can find a way to not wreck the federal budget and the world’s most dynamic economy, my members will keep telling me to find free-market solutions. They’re risk takers and would rather have the opportunity to grow at the best rate possible.I guess small business owners aren’t happy with a Japan-like growth rate; they want the opportunity to grow at any rate they desire and create for themselves, business, employees and family.
By now of course I’m getting a little feisty on that basic math question:
From: Matthew Holt [mailto:email@example.com] Sent: Wed 12/20/2006 6:34 PM To: Ragley, Jay Subject:RE: Small Business Health Insurance Editorial
I understand that you represent your members and that their policies are what you follow. I would also humbly ask how many of your members know what share of GDP is spent on health care here versus Japan, Korea, Taiwan, Germany, France et al…you know the answer. Those countries spend virtually 50% the amount we do on health care. So you explain to me how spending 50% less on something bankrupts us faster than spending at our current rate (and our faster growth rates).
If government imposes a tax to pay for health care, but at the same time removes the cost of providing health care from business, how does that hurt business? It’s a revenue neutral move. And more importantly in the long run the example of all those other countries is that government (or some proxy for it) has a much better shot at controlling health care costs because the taxpayer realizes the correlation between increasing costs and their taxes going up. But in this country we don’t bother making that equation, and so we keep paying more and more for health care.
But I guess if you pay money to a private insurance company that incidentally keeps 15-25% of your money in its pocket for doing not much, then that’s not a tax–so it’s OK to spend money on health care that way. But I get very confused when you tell me other countries are "going bankrupt" when they are containing spending much better than us, because they are using the government rather than an ineffective insurance sector to control spending. Are you telling me that if they spent at our rates of GDP they would be better off?
And BTW whatever you believe about the Laffer curve, you may have noticed that taxes going down can also lead to huge government deficits. Or were you not paying attention for the last 5 years?
To which, like a true booty-mercantilist, he resorted by appealing to my own best interests!
From: Ragley, Jay [mailto:Jay.Ragley@nfib.org] Sent: Wednesday, December 20, 2006 4:51 PMTo: firstname.lastname@example.orgSubject: RE: Small Business Health Insurance EditorialMatthew:Lots to digest here but not enough time tonight for a response. Will get back to you. Although I have to wonder, wouldn’t your consultant company go out of business with a government health insurance system? I mean, you would have to get a job with the government I guess.JWR
And I’m afraid I went for the non-technical KO:
From: Matthew Holt [mailto:email@example.com] Sent: Wednesday, December 20, 2006 4:55 PMTo: ‘Ragley, Jay’Subject: RE: Small Business Health Insurance EditorialSo is it about doing the right thing, or hanging on to my business at any cost? Sounds like a paper-pushing unionized bureaucrat’s view to me!
And don’t worry–there are LOTS of people for whom a single payer system WOULD be very bad news (Insurers, drug cos, many doctors, many hospitals, etc) I just don’t think that small businesses can be counted amongst them!