They say you should beware of Greeks bearing gifts. We should probably also be wary of politicians offering simple solutions.
The Democratic presidential field is winnowing as we approach “Super Tuesday.” For the most part, there isn’t much distinction between the candidates. Even the non-Democrats — socialist Bernie Sanders and recently-independent technocrat Michael Bloomberg — hew pretty closely to the party line.
Yet, in an effort to capture the imagination of their primary electorate, the candidates have been continually dumbing down their “policy” proposals. And by “policy,” I generally mean spending.
Those who are a bit more moderate — or maybe realistic? — have “freebie”-lite ideas. Maybe instead of free college for everyone, it is targeted to those of lower incomes. Instead of a single-size Medicare For All, it is an opt-in public system.
But spending other people’s money, such as the public treasury, is pretty easy. You will always run out of money long before you run out of ideas on how to spend it. So the rubber meets the road when it comes to paying for their proposals.
On Wednesday, the nonpartisan Committee for a Responsible Federal Budget released their updated analysis of the cost for the health care plans of the Democratic candidates. It also included a dynamic assessment of how each would-be president intends to fund their preferred policy.
I’ll give away the punchline: Sanders’ plan would probably cost around $13 trillion over the next 10 years. If you’re optimistic, it will only cost $8.5 trillion; the pessimistic perspective says it is closer to $18 trillion.
Those numbers are net, after all Sanders’ proposed tax increases take effect. And the democratic socialist’s “revenue generation” plan isn’t modest either; he’s proposing around $16 trillion in tax hikes over the same period. Again, doing the math, that means the gross cost of his Medicare For All plan is closer to $30 trillion.
The only candidate submitting reforms unlikely to add trillions to the federal deficit is Pete Buttigieg, whose tax hikes would more than cover the proposed cost of his plan. Joe Biden is second at a net cost of $800 billion. And Warren’s proposal swings wildly, but her “midpoint” scenario will add around $6.5 trillion to the national debt.
Amy Klobuchar and Michael Bloomberg’s solutions weren’t included in this analysis as they were not in the top tier of candidates when it was first assembled. But I’ll hazard a guess on how it would go; Klobuchar is closer to Warren, while Bloomberg thinks like Buttigieg.
Sanders is great at painting with big, broad strokes on how to fix things, despite fiscal insanity. With liberal dashes of buzzwords like “billionaires,” “revolution,” and “Wall Street greed,” he has reached frontrunner status.
But beware of seemingly simple solutions.
One of the great villains in the health care debate is pharmaceutical companies. Understandably so. Drugs are expensive, and Americans seem to pay more than others. It doesn’t help that we are continually assaulted by television ads pitching pills for every possible ailment.
Fighting these high prices is certainly politically popular. And, frankly, a worthwhile endeavor. However, Maine’s teachers, cops, and transit workers all rely on pharmaceutical companies turning profits. Our public employee retirement system — MainePERS — has nearly $70 million invested in the pharmaceutical companies Johnson & Johnson, Merck, and Pfizer.
We are not unique. CalPERS — California’s system — has over $2 billion invested with Pfizer and Johnson & Johnson alone. If pension funds’ investments take a nosedive, then either retirees will need to reassess their income expectations or states will need to find money — probably through new taxes — to make good on old promises.
In short, it’s a complicated, sticky mess we’re in. And, while simple answers are often tempting, they are not necessarily thought through. It seems everyone agrees that our healthcare apparatus needs fixing; there is simply disagreement on how to best do so.
But beware of politicians offering simple solutions. If it sounds too good to be true, it probably is.