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Why the Republicans Refused to Cut Obamacare

July 29, 2017

Republican voters feel used.  Republican politicians refused this week to eliminate Obamacare.  How does that make any sense?  The 12 million words of Obamacare and its regulations were a colossal failure for us.  Insurance prices went up a lot.  Coverage went down.  A large minority of us can only find a single provider in the “insurance plan”.  Worse still is that many of us lost our jobs because our employers could not pay for us and our healthcare at the same time.  With that record, why wasn’t Obamacare easily replaced?  Obamacare works for a few people.  It works for the politicians in power.  That is why they won’t replace it.  Here is how Obamacare works in practice.

The job of politicians is to get re-elected.  They do that by concentrating government spending to a few powerful companies or groups.  The dynamics are simple and worth understanding.  You and I won’t make a large political donation if our politician cuts our taxes by a dollar for each of us.  If the politician concentrate all that money in one place, then the 323 million dollars produces tens of millions of dollars in gratitude.  That gratitude is shown in the form of lobbying and campaign donations.  A tax and spending cut could help the economy.  Special interests help the politician.  It isn’t a tough choice once you’re in office.  So who lobbied to keep Obamacare in place?

The old medical system had many insurance programs and many medical providers.  You may not have liked the coverage you had, but you could go to another plan when you thought you found a better deal.  Now, Obamacare is such a bad deal that they had to impose thousand-dollar-penalties on us if we didn’t participate.

The advantage of Obamacare for the politicians is that there are only a few providers.  Only a few insurance companies provide coverage in a given area.  In some regions these companies have a monopoly.  The providers have multi-million dollar incentives to make sure Obamacare doesn’t change.  Their money talks.  They have millions of dollars at stake, so they pay lobbyists and politicians.  There is more.

Your pharmacist used to be able to shop around for the best deal he could find.  Now, there are only a few pharmaceutical companies who are approved for a given drug.  In theory that lowered the costs of drugs.  In practice it concentrated the political kickbacks to politicians.  That adds up to billions of dollars.

Your healthcare used to pay for your doctor and your pharmacist.  Now it pays for your doctor, your pharmacist, and an army of lobbyists.  No wonder your prices went up. Now you know how politics works in practice.

Our politicians know Obamacare is unpopular.  That is why Republican politicians campaigned against Obamacare when they were seeking office.  Now the Republicans are in power.  Now it is their turn to get the campaign contributions from lobbyists.  That is why the Republican controlled Senate wouldn’t kill Obamacare.  Your Senators are betting that the extra campaign cash from special interests will return him to office in the next election.

It is your job to show them they are wrong.  Lobbyists have millions of dollars.  You have millions of voices.  Use what you have.

~_~_

The original post is here.

I gave you a few hundred words.  Please share and leave a rating. RM

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2 Comments leave one →
  1. July 29, 2017 2:00 pm

    I used to teach public choice economics at George Mason University. Public choice is the economics of politics, and was founded by the (recently maligned) Noble Prize winning economist James Buchanan.
    I would give this article an A+ for an introductory public choice class and a B for an advanced class in the Public Choice of Health Care class. Mr. Morse, you are an apt pupil!

    Liked by 1 person

    • July 29, 2017 2:11 pm

      I get it. No evidence of a literature search with citations. True, I need to read more.

      Like

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