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31 July 2007

Philosophy or Politics?

Elsewhere on the Times op-ed page, Paul Krugman attack [$]s the philosophy behind Bush's opposition to expansion of the State Children’s Health Insurance Program (Schip). Assuming he's not being disingenuous, Krugman sounds rather naive.

Krugman makes this astonishing claim: "[Bush] wants the public to believe that government is always the problem, never the solution." What, pray tell, in Bush's 6 years in office suggests that this is what he wants people to believe? Bush is all about using government to solve things - prescription drugs, schools, drug abuse, international terror - Bush is not one to shy away from top-down, federal government solutions. Maybe not just the ones Krugman wants him to adopt.

Krugman points to his opposition to the more expansive House approach to Schip.
[It] would cover more children, is more expensive, but it offsets Schip costs by reducing subsidies to Medicare Advantage — a privatization scheme that pays insurance companies to provide coverage, and costs taxpayers 12 percent more per beneficiary than traditional Medicare. Strange to say, however, the administration, although determined to prevent any expansion of children’s health care, is also dead set against any cut in Medicare Advantage payments. So what kind of philosophy says that it’s O.K. to subsidize insurance companies, but not to provide health care to children?"
Maybe the expansion of this plan is a good idea and maybe not, but it's unlikely that philosophy is behind much of the debate, except indiretly. Bush, like Republicans generally, takes a strong pro-free-market stand. As a result, he gets strong support and lots of money from businesses. Businesses, though, are more or less indifferent to free-markets in general but are rather fanatical about their own market. In this case, no doubt, insurers who will be hurt by this Schip expansion are all putting a great deal of pressure on the administration to oppose it - on philosophical grounds, of course.

And so the pendulum swings - excesses by one side (Democrats in the early nineties) bring about Republican victories, but the money behind the Republicans soon corrupts them, leading them to oppose popular, moderate programs supported by Democrats, who then get to take more power from the mean Republicans. The Democrats have had the luxury of some fairly reasonable agenda items to promote during these first few months of power, like raising the minimum wage, but at some point their hard-core constituency will have them pissing off middle America, and the pendulum will swing back.


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