{"id":3351,"date":"2012-01-20T12:01:23","date_gmt":"2012-01-20T17:01:23","guid":{"rendered":"http:\/\/www.multiplier-effect.org\/?p=3351"},"modified":"2012-01-20T14:38:41","modified_gmt":"2012-01-20T19:38:41","slug":"deficit-doves-and-owls-how-to-worry-about-healthcare-costs","status":"publish","type":"post","link":"https:\/\/blogs.bard.edu\/multiplier-effect\/deficit-doves-and-owls-how-to-worry-about-healthcare-costs\/","title":{"rendered":"Deficit Doves and Owls: How to Worry About Healthcare Costs"},"content":{"rendered":"

You may not agree with Alan Blinder when he writes in the Wall Street Journal<\/a> that the budget deficit should <\/em>be an issue in the 2012 campaign.\u00a0 But it certainly will be.\u00a0 And Blinder deserves kudos<\/em> for pointing out that there are no immediate or near-term economic problems stemming from US deficit and debt levels:<\/p>\n

\u201cMyth No. 2<\/em> is that America’s deficit problem is so acute that government spending must be cut right now, despite the struggling economy. And any fiscal stimulus, even the payroll-tax extension, must be “paid for” immediately.<\/p>\n

Wrong. Strange as it may seem with trillion-dollar-plus deficits, the U.S. government doesn’t have a short-run borrowing problem at all. On the contrary, investors all over the world are clamoring to lend us money at negative real interest rates. In purchasing-power terms, they are paying the U.S. government to borrow their money!\u201d<\/p><\/blockquote>\n

Blinder also points out that if you accept the CBO\u2019s long-term budget forecasts (James Galbraith notes some problems with the projections here<\/a>), then the issue is entirely one of healthcare costs.\u00a0 Deficit doves and deficit owls (proponents of “functional finance”) will dispute the optimal or sustainable level of long-term deficits, but if<\/em> you care about the long-term deficit, then you care about government healthcare costs.\u00a0 And growth of government healthcare costs is largely a function of cost inflation in the private market.\u00a0 So if you have any interest in the long-term deficit, then you have to have a plan for controlling long-term healthcare costs system-wide.\u00a0 If you don’t have such a plan, you\u2019re engaged in some other type of project.<\/p>\n

If you haven\u2019t seen it already, this is a great utility<\/a> that’s been linked to over the years, allowing you to see what the US budget deficit would look like if we spent the same amount per capita as other nations.\u00a0 For the owls, this won\u2019t be a matter of long-term debt and deficits, but of efficiency:\u00a0 what exactly are we getting by spending more than twice as much, per capita, as other wealthy nations?<\/p>\n

Randall Wray and Marshall Auerback put out a Levy Institute policy brief in 2010 on their vision for healthcare reform that featured giving people under 65 the option to “buy in” to Medicare (you will recall that at one point during the health reform battle this provision looked like it might be included in the final bill.\u00a0 It was ultimately dumped<\/a> by Joe Lieberman).\u00a0 Read the policy brief here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

You may not agree with Alan Blinder when he writes in the Wall Street Journal that the budget deficit should be an issue in the 2012 campaign.\u00a0 But it certainly will be.\u00a0 And Blinder deserves kudos for pointing out that there are no immediate or near-term economic problems stemming from US deficit and debt levels: […]<\/p>\n","protected":false},"author":202,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49,112],"tags":[177,32,99,178,176],"class_list":["post-3351","post","type-post","status-publish","format-standard","hentry","category-fiscal-policy","category-modern-monetary-theory","tag-cbo","tag-deficits","tag-federal-debt","tag-health-reform","tag-healthcare-costs"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/3351","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/users\/202"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/comments?post=3351"}],"version-history":[{"count":10,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/3351\/revisions"}],"predecessor-version":[{"id":3358,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/3351\/revisions\/3358"}],"wp:attachment":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/media?parent=3351"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/categories?post=3351"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/tags?post=3351"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}