In the case of healthcare and insurance perception is reality — -even when it isn’t. My biggest fear for universal coverage is that our legislators will, as they do with all big spending initiatives, get the cart before the horse and do great damage to the economy. With something as big as healthcare in a rapidly aging society that damage could be immense, but for completely different reasons than most are considering.
I have a Facebook friend who holds a doctorate in macroeconomics and has written several books involving economics. It is his position that the government can not only provide coverage for everyone without charging premiums or raising taxes but that the transition might require tax “CUTS”, or increases in deduction levels, to prevent deflation. Due to our reluctance to elect the smart people in the room, this would likely never be considered and the cuts would be forced on us via unemployment and automatic stabilizers.
His concern is that most people get their coverage from their employment and that is largely employer subsidized so ending premiums for them won’t be the economic stimulus it is imagined to be, benefiting employers much more than workers. Since most workers couldn’t accurately state how much their insurance actually costs the motivation for employers to take the money and run will be considerable.
Sen Sanders’ plan does include a tax on large employers (>$2 million payrolls) to mitigate the increased potential for inequality but that doesn’t translate to “paying for” anything with our current tax structure. At best, it would reduce the deficit, but that is also a net loss to the private sector economy in macro accounting where the government’s red ink is the private sector’s only net source of black ink.
In spite of the fantasy promoted by our neoliberal politicians and media, there is no mechanism that allows tax receipts to directly “fund” spending at the federal level. It was simply never needed for the monopoly issuer of the currency beyond an accounting entity, so tax “revenue” has remained an oxymoron. Taxes can’t be collected from money that doesn’t yet exist, so all spending is accomplished via new currency creation and taxes (and bond revenue) are simply deleted, zeroed out by the debt that created them, upon entry into the government sector.
This is much cleaner as it complies with dual entry spreadsheet accounting and better defended the gold reserve when we did that nonsense. However, given the success of promoting balanced budgets as the holy grail of government fiscal policy the average American voter views the process from their perspective as “users” of the currency and demands to know how each budget item will be “paid for”. This makes any large spending initiative all but impossible, but that is the end goal of neoliberalism that promotes privatization and market control over every facet of our lives.
Instead of worrying about how to pay for universal coverage, that government has already half achieved via Medicare, Medicaid, VA, etc, we should be concerned with the real resources that would be needed and the numbers of workers the plan would cause to be unemployed. These resources and workers are the basis of the “real” economy and the money only exists to distribute those in an orderly way. The US Dollar is a no-cost commodity to Congress to use to accomplish that distribution, but it always ends up as the focus of any debate over spending. This has crippled our government in realizing its goal of providing for the “common welfare” as mandated by our Constitution.
