By MIKE MAGEE
In this world of political theatrics, with Democratic legislators from Texas forced into exodus to preserve voters’ rights, and Tucker Carlson rantings about Rep. Eric Swalwell riding shirtless on a camel in Qatar streaming relentlessly, Americans can be excused if they missed a substantive and historic news event last week.
On Friday, July 9th, President Biden signed a far-reaching executive order intended to fuel social and economic reform, and in the process created a potential super-highway sized corridor for programs like universal healthcare. In the President’s view, the enemy of the common man in pursuit of a “fair deal” is not lack of competition but “favoritism.”
To understand the far-reaching implications of this subtle shift in emphasis, let’s review a bit of history. It is easy to forget that this nation was the byproduct of British induced tyranny and economic favoritism. In 1773, citizens of Boston decided they had had enough, and dumped a shipment of tea, owned by the British East India Company, into the Boston Harbor. This action was more an act of practical necessity than politics. The company was simply one of many “favorites” (organizations and individuals) that “got along by going along” with their British controllers. In lacking a free hand to compete in a free market, the horizons for our budding patriots and their families were indefinitely curtailed.
Large power differentials not only threatened them as individuals but also the proper functioning of the new representative government that would emerge after the American Revolution. Let’s recall that only white male property owners over 21(excluding Catholics and Jews) had the right to vote at our nation’s inception.
Over the following two centuries, power imbalances have taken on a number of forms. For example, during the industrial revolution, corporate mega-powers earned the designation “trusts”, and the enmity of legislators like Senator John Sherman of Ohio, who as Chairman of the Senate Republican Conference, led the enactment of the Sherman Antitrust Act of 1890.
He defined a “trust” as a group of businesses that collude or merge to form a monopoly. To Sen. Sherman, J.D. Rockefeller, the head of Standard Oil, was no better than a monarch. “If we will not endure a king as political power, we should not endure a king over the production, transportation and sale of any of the necessities of life”, he said. The law itself stated “[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”
In the middle of the Great Depression, FDR also focused on financial favoritism as the source of the common man’s misery. Branding the powerful as “economic royalists”, he saw political corruption and worker exploitation as human foibles, and government regulation as an essential safeguard against our inborn tendencies toward greed and avarice.
Note the shift in emphasis. To FDR, the problem was not simply a structural lack of competition in our capitalist society, but also the absence of adequate regulation and oversight of humans who, in the pursuit of power and favoritism, levied harm and discrimination against each other.
By the time Ronald Reagan assumed the presidency, mass movement of people, data, and products had created a global marketplace. This new emphasis on “global competitiveness” provided moral cover for a twenty-year campaign of deregulation that spanned Republican and Democratic administrations. Now worldwide competition ruled the reign, ultimately descending to Trumpian reductionism where you were either a “winner” or a “loser.”
As corporate profits soared, wages and benefits for workers were slashed, and the gap between rich and poor soared. Over the past forty years, CEO pay increased by over 1000%, while the typical worker’s wage inched up by a meager 10%. Our favored 1%, supported by an army of state and federal lobbyists, argued that the solution to a widening power differential was more unfettered capitalism. That was until the COVID 19 pandemic arrived on our shores.
Strangely enough, the pandemic became an equalizer, a truth-teller, and a social experiment on a grand scale. All Americans sheltered at home for 18 months, and to varying degrees reflected on their purpose and priorities.
As an equalizer, the virus was “democratic”, showing little preference. All were vulnerable. The poor and minorities were slightly more at risk. But so were the elderly, those with chronic disease, and those ignorant enough to politically posture and deliberately place themselves at risk.
As a truth teller, the pandemic exposed the lack of national health planning, a limited capacity to handle a national health emergency, vulnerable and exposed health care workers, and enormous geographic variability in the quality of our health services. Our inadequate health system lay naked and exposed.
Finally, as a social experiment, for the first time in recent memory, our government provided direct relief and resources to our citizens themselves rather than “trickling down” relief through the hands of powerful intermediaries. Citizens found themselves part of the “favored” class. Fears of inappropriate use proved ill founded. The relief sustained our economy. Every day citizens’ purchases were wise and restrained. Debt was paid down and savings expanded.
Biden’s executive order, including 72 initiatives that impact health care, technology, transportation, agriculture and the environment, seeks to expand economic equality, not so much by injecting competition that can be manipulated and compromised by those who wield the power in our society, but by interacting simply and directly with America’s 99%.
Take just one initiative – the direction to allow over-the-counter sale of hearing aids. Traditionally defined, this move injects competition. But combined with expansion of Medicare benefits, the move entrusts every day people with the power to care properly for family and loved ones.
Which brings me to Universal Health Care. As I document in my book, “Code Blue: Inside the Medical Industrial Complex” (Grove/2020), America threw all its’ eggs into a profiteering capitalist basket over 70 years ago, leaving behind huge swaths of our citizenry, progressively diminished as the Health Sector profiteers cornered rough 1/5 of our GDP.
With the aid of new information technologies, and coordinated lobbying in a largely deregulated society, the Medical Industrial Complex followed the Standard Oil playbook, creating virtual horizontal and vertical integrated networks that were both collusive and monopolistic. Pharmacy Benefit Management (PBM) programs were but one example, opaquely moving data, pills and money, as their lobbyists secured the right to share hidden kickbacks among themselves.
President Biden’s actions last week weaken the hold of “competition” as a cure all for this nation’s economic injustice and inequity. By stating that “Capitalism without competition isn’t capitalism. It’s exploitation.” our President is inching the debate forward. Exploitation subtly suggests it is now our time to confront modern-day “economic royalists.”
What Biden needs to do now is double-down on the provision of direct benefits to our citizens themselves. As the pandemic has demonstrated, they can be trusted with this power to use our resources wisely without the help of powerful intermediaries. Extending a public health care option as a “favored” gesture to the 99%, would be a wise next step, and would send a message to “Health Care Royalists.”
Mike Magee, MD is a Medical Historian and Health Economist and author of “Code Blue: Inside the Medical Industrial Complex.“