Obama’s Health Care Trap

Politics is not chess, so there is no true ‘check mate’ moment: your opponent can always wriggle free by bending the rules or being plainly silly. Nonetheless yesterday Obama set a trap worthy of a chess master.

During his sometimes testy discussion of health care he wondered out loud about the logic of those who oppose a public plan option. Apparently they think it unfair that privately run plans should have to compete with such a government plan.

The ‘unfairness’ stems from the economics. Because a government plan would have a large contributory pool, and thus a large actuarial base, its costs would be lower than any private plan which would be smaller by definition. This is seen as undercutting the private insurers. Unfairly.

But isn’t that exactly why a public plan makes sense?

If you argue that a private plan cannot compete with a public plan, because of the latter’s inherent cost advantage, have you not just made the case for public plans? Yes you have.

To continue with that line of argument you have to shift the focus of the entire discussion. By admitting that public plans are more cost effective you are clearly saying that cost should not drive the discussion. Something else should. To me this is odd, since cost is what we are worried about. But on we go: so what are you thinking of as the key driver of policy? Well, continuing with the reasoning, it has to be protecting the private plans from ‘unfair’ competition. In other words your emphasis is on protecting the insurance companies.

Since that doesn’t sound too good: the insurance companies are not very popular, you need a better line of attack.

So these opponents shifted to the old ‘government is awful at managing something’ line. We have heard that a lot lately in regard to GM as well.

The problem you now have is even worse.

You just said that the government is an unfair option because of its low costs. Do you really mean that if the government could actually run something with all the acumen of an insurance company – I’m kidding of course – then it would be even cheaper? And therefore an even tougher competitor?

Maybe you don’t mean that.

But, as Obama snarkily commented, if government is that bad at running things why worry about its unfair competition? There won’t be any.

Seems like this:

Either the government can run things. In which case its plan will always be cheaper than any possible private plan. So we should just go with the government plan.

Or. the government will bungle things terribly and present no competition at all, in fact its bungling will encourage people to buy private plans. So we should go with a government plan for comparative purposes and to sop up those consumers who are not interested in efficiency – thereby increasing profits for the private plans.

Heads I win. Tails you lose.

A government plan either way.

QED.

Nice move Obama.

Unfortunately this politics. Watch for the truly stupid opposition move next.