A popular right-wing canard is to proclaim Social Security, a foundational program in President Franklin D. Roosevelt's New Deal, in crisis. To put it bluntly, there is no crisis. An explanation:
Social Security does face a shortfall over the next 75 years. However, predicting this sort of shortfall is like predicting the weather: the farther into the future you project things, the less certain your predictions.
The point of this is not to say that we should go on doing nothing. (Though, personally, I think we can afford to wait a decade or so.) It is to say that we should remember that this problem is not projected to hit us for another 33 years, and that before we completely freak out, we should think about the possibility that those predictions are wrong. We should also remember that the projected shortfall is quite manageable. (It's worth bearing in mind that a lot of the projections are over 75 years.) For instance, as Table 2 here makes clear, we could make up for it simply by letting the Bush tax cuts on the wealthiest 1% of Americans expire and dedicating the proceeds to the SS trust fund.
President Bush's failed attempt to privatize Social Security just drives the point home that this country doesn't believe shoring up Social Security's long term solvency (we're talking 75-100 years out) is a pressing problem.
But we do, in fact, have a genuine crisis on our hands: Health care.
The next President is predicted to come into power with a record $482 billion of government debt, a testament to George Bush's "fiscally conservative" nature. And that debt is predicted to grow, mostly driven by increases in the cost for programs like Medicare.
Now, as the National Committee to Preserve Social Security and Medicare points out, the forces driving increased Medicare costs have nothing to do with "bloated government programs" or "inefficient bureaucracy:"
The long-term costs of Medicare, on the other hand, are primarily driven by the same factors that have caused skyrocketing health care costs for workers and their employers, and which the nation has, to date, been unable to solve. This interrelationship means that attempting to limit future cost increases in Medicare without addressing the problems of our nation's healthcare system as a whole simply will not work. And a policy that relies primarily on shifting more costs onto seniors, who are mostly lower-income, is unfair and not sustainable over the long term.
To put it simply, the problems with skyrocketing Medicare spending stem from skyrocketing health care costs throughout our system. As I have argued before, these skyrocketing costs hurt everyone
, whether they are in Medicare programs or not:
So, given that we are spending 15% of our national prosperity on a product that fails to deliver on its promises, is it any wonder we find ourselves in dire straight economically? And if we could get that same 15% that we spend on health care working harder, isn't it possible we could either a) spend less, or b) get more for that money, and that would help turn our economy around? Healthy children learn more. Healthy adults work more. Healthy countries are more prosperous.
So, Social Security isn't in crisis, and Medicare isn't failing because it's a government program - in fact, it's more efficient than private insurance. We have a health care problem because health care costs are going up for everyone in America, causing us to spend more and more of our hard earned money every day for less and less benefits, all while the private insurance industry continues to reap huge profits.
In order to fix our mounting public debt, and in order to turn our economy around, we need to reign in health care costs. And the most effective way of doing that is to make sure we're sharing risk fairly.
The private insurance industry in America can charge customers different premiums based on their age and health history - the amount they can afford to pay doesn't factor into the decision. When old, sick, and/or poor customers can no longer afford their premiums, or have to change jobs, get married, or do anything else that would change their insurance status, private insurers do everything they can to drop them as customers, because these people very quickly go from being profitable accounts in their ledgers to big expenses. These old, sick, and/or poor end up on public health care plans like Medicare or without insurance altogether - which means they show up at emergency rooms to get treated for free, by far the most expensive way to get health care. Therefore, our current health care system allows private insurers to collect premiums from healthy and/or wealthy customers and drop the sick, old, or poor on the public's rolls. This is not sharing risk fairly.
To reduce health care costs, risk must be spread out - even if it is at the expense of profits. Premiums should be calculated based on a person's ability to pay, not on their health history or age. Standard levels of care need to be established, both for preventative medicine and for treatment of the sick. A public health care plan must be created that is open to all to fairly share risk. Most importantly, insurers - both private and public - must not be allowed to drop customers or raise rates when health circumstances change. To do less is not fair, and as it is currently practiced, unfair sharing of risk is the main driver of health care costs in this country and one of the main reasons we spend so much more on health care than other countries.
Other ways of cutting costs include:
- standard claims forms
- secure electronic medical records
- collective bargaining for better prices
- better management and treatment of chronic diseases
- and a focus on preventative medicine
With an expensive war in Iraq and a President with no self-control with regards to spending, public debt is indeed an issue. Therefore, reigning in health care costs - the main driver of this debt - should be at the top of our list of priorities. And the only way to reign in those costs is through fair risk-sharing. It should be clear to all - given the already intensely privatized nature of our health care system - that even more "free market" reforms will do nothing to drive down health care costs. The private actors in this industry and making off handsomely by putting profits before people and there is no indication that further privatization will cause them to behave any differently.