the nation is not, in fact, “broke.”


An opinion from Paul Krugman of the NY Times, followed by several readers reactions to the opinion. I’ve read through most of the readers reactions, and found most of them engaged in Republican and/or Conservative bashing. I guess this indicates that most of us will read that which we are already inclined to agree with. However, I did glean several interesting reactions that seem to go contrary to Mr. Krugman.

I’ve interjected some of my own observations within each section.

Dumbing Deficits Down

By PAUL KRUGMAN
Published: March 10, 2011

Like anyone who writes regularly about what passes for economic and fiscal debate in American politics, I’ve developed a strong tolerance for nonsense. After all, if I got upset every time powerful people were illogical and/or dishonest, I’d spend every waking hour in a state of raging despair. Hear, hear Mr. Krugman, I myself detect a great deal of nonsense in your own thinking and writing on economics.

Fred R. Conrad/The New York Times

Paul Krugman

Yet there are still moments when I find myself saying, “They can’t really be that stupid,” or maybe, “They can’t really think the rest of us are that stupid.” And I had one of those moments reading about a recent conference on national health policy, which featured a bipartisan dialogue among Congressional staffers.

According to a column in Kaiser Health News, Republican staffers jeered at any and all proposals to use Medicare and Medicaid funds better. Spending money on prevention was no more than a “slush fund.” Research on innovation was “an oxymoron.” And there was no reason to pay for “so-called effectiveness research.”

To put this in context, you have to realize two things about the fiscal state of America. First, the nation is not, in fact, “broke.” “Mr. Krugman can’t really be that stupid,” or maybe, “He can’t really think the rest of us are that stupid.” The federal government is having no trouble raising money, and the price of that money — the interest rate on federal borrowing — is very low by historical standards. So there’s no need to scramble to slash spending now now now; we can and should be willing to spend now if it will produce savings in the long run.

Second, while the government does have a long-run fiscal problem, that problem is overwhelmingly driven by rising health care costs. The Congressional Budget Office expects Social Security outlays as a percentage of G.D.P. to rise 30 percent over the next quarter-century, as the population ages, but it expects a near doubling of the share of G.D.P. spent on Medicare and Medicaid.

So if you’re serious about deficits, you shouldn’t be pinching pennies now; you should be looking for ways to rein in health spending over the long term. And that means taking exactly the steps that had those G.O.P. staffers sneering.

Think of it this way: Congress could, with a stroke of a pen, cut Social Security benefits in half. But it couldn’t do the same with health spending: Medicare can’t suddenly start paying to replace only half a heart valve or mandate that bypass operations stop halfway through.

Limiting health costs, therefore, requires a smarter approach. We need to work harder on prevention, which can be much cheaper than a cure. We need to find innovative ways of managing health care. And, above all, we need to know what works and what doesn’t so that Medicare and Medicaid can say no to expensive procedures with little or no medical benefit. “So-called comparative effectiveness research” is central to any rational attempt to deal with America’s fiscal problems.

But today’s Republicans just aren’t into rationality. They claim to care deeply about deficits — but they’ve spent the past two years putting cynical, demagogic attacks on any attempt to actually deal with long-run deficits at the heart of their campaign strategy. In case you haven’t noticed, Mr.Krugman, the Tea Party is all about (mostly) Republicans caring about, and attempting to do something about out of control government spending.

Here’s a recent example. In his new book, Mike Huckabee — the current leader in polls asking Republicans whom they want to nominate in 2012 — attacks the Obama stimulus because it included funds for, yes, comparative effectiveness research: “The stimulus didn’t just waste your money; it planted the seeds from which the poisonous tree of death panels will grow.” Will others in the G.O.P. stand up and say that Mr. Huckabee is wrong, that Medicare needs to know which medical procedures actually work? Don’t hold your breath.

Of course, Republicans aren’t the only cynics. As the national debate over fiscal policy descends ever deeper into penny-pinching, future-killing absurdity, one voice is curiously muted — that of President Obama.

The president and his aides know that the G.O.P. approach to the budget is wrongheaded and destructive. But they’ve stopped making the case for an alternative approach; instead, they’ve positioned themselves as know-nothings lite, accepting the notion that spending must be slashed immediately — just not as much as Republicans want.

Mr. Obama’s political advisers clearly believe that this strategy of protective camouflage offers the president his best chance at re-election — and they may be right. But that doesn’t change the fact that the White House is aiding and abetting the dumbing down of our deficit debate.

And this dumbing down bodes ill for the nation’s future. Health care is only one of the large and difficult problems America needs to deal with, ranging from infrastructure to climate change, all of which demand that we engage in a lot of hard thinking. Yet what we have instead is a political culture in which one side sneers at knowledge and exalts ignorance, while the other side hunkers down and pretends to halfway agree.


March 11th, 2011

I am a medical doctor and have a degree in economics. I can tell you with complete confidence that in my experience that “effective government” is an oxymoron as it relates to medicine.
A government agency is successful if it grows every year and is fully funded and spends all its funds every year. In working as a contractor at the Naval Weapons Center, China Lake CA, I saw this on a yearly cycle. Make sure to spend all of the money so we will get the same or more next year. This resulted in large purchases of computers that went unused, or replaced those purchased the year before for the same reason.  Effectiveness has nothing to do with it. I have been on staff at VA hospitals and County Hospitals and they are the least effective hospitals in the United States. The profit motive is the magic of the private sector. Public Medicine will never be as good as Private Medicine. As an administrator told me, “quality is assumed”. There is always a large number of administrators in Public Medicine with unending committees, meetings and forms. They are always touting improvement and patient satisfaction but in practice they are a failure.
As per the deficit. If you do not believe we are broke now. When will you believe it? When no one will lend to us like Greece? Ireland?, Spain? California and most other states? Every generation has to learn about fiscal responsibility. My parents lived through the depression and were frugal. We will have to experience the worst of times to relearn this lesson. Mr.Krugman believes in deficits and debt. I do not. I believe in hard work, just reward and earned wealth. Government is only for a “safety net”, national security and the least regulation necessary. We have lost sight of these principles and have become Europe.
Remember why the United States was different. All of the motivated, creative hard working from Europe left in the 1700’s and 1800″s leaving those desiring the nanny state still in Europe. The United States is heading towards becoming Europe where there is a cap on productivity, wealth and success. Also, Europe is always a day late and a dollar short in Foreign Policy, like Obama is in the Middle East.


March 11th, 2011

The reason for high health care cost is that there is no personal cost to risky and destructive behavior that none of the effectiveness research is going to fix. We don’t have effectiveness research for televisions to inform public on what megahertz refresh rate is better based on some price point. The reason for high cost is because we have obesity rate that is 50% higher than even Canadians. If we were pricing the auto insurance the way we price health insurance, we will all be driving drunk in the left lane at 100+ miles per hour and will never change oil in our car knowing that any cost of engine failure is going to be paid for by others in the form of insurance. Unless you have direct payments for most health care services (with government providing financing for those who have no means the way it provides food stamps – by paying merchants the same reimbursement as general public and not an artificial rate) and people feel impact of their choice in terms of higher health cost for themselves or their families, the cost will continue to sky rocket. The only reason for effectiveness research is to reduce funding for future drug improvements that cost more. It is not exactly a “death panel” but it is a “death to new drugs panel”.


March 11th, 2011

“…one voice is curiously muted — that of President Obama.” There you have the definitive description of Obama – of his presidency, his advocacy, above all his leadership. That last one – leadership – is virtually non-existent. His self-muting is the primary reason we continue to struggle through this recession, why health care “reform” is anemic, why he – and thus we as a nation – still have Guantanamo hanging around our neck like an albatross, and a host of other major issues he has failed to deliver on.
He talks a good game in campaigns, but that’s as far as it goes, unfortunately for us. You’ll see him release the mute button sometime late this year or early 2012. And then we’ll hear a bunch of promises again – but this time we’ll know that the classic marketing phrase “Where’s the beef?” could have been written for him. It’s also unfortunate for us that he’s only marginally better than anything the Republicans can throw up (figuratively speaking…I think), because the GOP these days is no bar to measure excellence by.
Real leaders don’t have a mute button.

We have elected a President whose resume consisted almost entirely of being able to give a good speech. After two years, that still seems to be the case. Hopefully we can do better next time.

What say you?

don

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