Tag Archives: health insurance

What Do Obamacare and the EITC Have in Common with Cap-and-Trade?

My preceding blog post described how market-oriented mechanisms to address environmentally damaging emissions, particularly the cap-and-trade system for SO2 in the United States, have recently been overtaken by less efficient regulatory approaches such as renewables mandates.   One reason is that Republicans — who originally were supporters of cap-and-trade — turned against it, even demonized it.

One can draw an interesting analogy between the evolution of Republican political attitudes toward market mechanisms in the area of federal environmental regulation and hostility to the Affordable Care Act, also known as Obamacare.   The linchpin of the program is the attempt to make sure that all Americans have health insurance, via the individual mandate.  But Obamacare is a market mechanism, in that health insurers and health care providers remain private and compete against each other.   

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Look Who Opposes Obamacare, by Fat Margins

     The Supreme Court today upheld the Affordable Care Act of 2010, otherwise known as Obamacare.  Judging from the polls, American public opinion appears to be very sharply divided over the legislation.  Some view it as socialism, others as the first success in a half-century of efforts to achieve a sensible national policy on health care.

       What explains the wide divergence of views?   An economists’ approach – cynical or naïve depending on how you look at it – would be to assume that citizens vote according to their own personal interests.   Getting the uninsured onto paid insurance through the individual mandate is very much in some people’s interest, but not necessarily as strongly in others’ interests.  Let’s take a look.

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Limit Tax Expenditures

The National Journal asks for views on a recent proposal from Len Burman .  I couldn’t agree more with the idea:  we need to limit tax expenditures.  
 
With regard to the politics, one would have to see whether the phrase “cut tax expenditures” polls more like the phrase “cut expenditures,” which I assume polls well, or like the phrase “raise taxes,” which of course polls horribly.  I have no idea.  But at least there is a hope of breaking through the mindless artificial “Taxes versus Spending” rhetoric that dominates Washington.

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