Friday, September 11, 2009
The day after President Obama's impassioned speech for big-government health care, Wall Street bet heavily that the so-called government-insurance option he supports is dead.
In a strong stock market on Thursday -- the market's fifth-straight daily rise (so much for the September swoon) -- health-insurer shares advanced significantly. Cigna increased 5 percent; Health Net almost 5 percent; Humana 3.5 percent; and UnitedHealth Group 1.5 percent. Hospital shares like Community Health Systems and Tenet Healthcare also rallied smartly, climbing about 5 percent each. Drug company Pfizer rose more than 1 percent.
These stocks would not have rallied if the public option looked alive. Corroborating this, the Intrade pay-to-play online betting parlor shows only a 24 percent probability of the government option passing by the end of this year. Also, of 17,308 respondents in a Politico poll, 38 percent registered thumbs-up for the president's address, while 58 percent said thumbs-down.
Obama's speech was not a game-changer. Good delivery, bad product. And at the top of the list, the new government-insurance option, which surely is a gate-opener for the government takeover of the entire health care sector, is a clunker. The public doesn't like it. Moderate and conservative Democrats don't like it. Republicans can't stand it. And Wall Street doesn't want it. Hence, the Dow's 80-point rally the day after the speech.
But the free-market option is still nowhere to be found. Right now, Sen. Max Baucus, D-Mont., is working to save President Obama's face, with a kind-of Obama Lite plan coming out of his Senate Finance Committee. But Baucus' framework has individual and business mandates, and it surely will give the government an even stronger whip hand on health care.
There are taxes galore for this $900 billion baby. It includes a 35 percent excise tax on high-end insurance policies, plus billions more in taxes on insurers, drug companies and medical-device makers. Government boards will determine value, quality and quantity for doctors, hospitals and clinical laboratories. Folks who opt out could face a $3,800 tax (based on a family of four).
At the end of the day, thoroughgoing free-market choice and deregulation is just as missing in action under Baucus as it is under Obama. There's a bipartisan deal to be had, one that would deregulate health insurance across state lines. It could pass the Senate. But Democratic leaders aren't going there. For some reason, they won't put the market to work.
In other words, there's no real market and no real choice in Democratic health reform.
Under the Democratic plan, seniors are even going to lose Medicare choice. A $500 billion reimbursement cutback of Medicare to health care providers would wreck private health care profitability. And other casualties could include the 11 million people in the Medicare Advantage program (which allows insurance choice) and the 8 million in health savings accounts. These will be scrapped under Obama-Baucus.
So we'll be left with the same health care insurance system that is dominated by big government, big business and big insurance companies. Government and the insurance lobby love their oligopolistic powers. But it's exactly these third-party payers who create the supposed free lunch that unnecessarily bloats the expenses of the health care system.
Only the free market will solve our cost problems, doing it in a way that no other government program can.
And speaking of free-market consumer choice and competition, wouldn't it be nice if the 12 million low-income and chronically uninsured folks in America today got vouchers or refundable tax credits so they could shop around for the best plan available?
In fact, to promote real free-market choice, the entire insured population should get a tax break so that everyone can purchase plans on a pre-tax basis, just the way businesses do. And the free-market cost control of government expenses can coexist beautifully with the continued rapid growth of the private health care sector -- which is fast becoming America's No. 1 industry.
In an article for the American Enterprise Institute, Noble Prize winner Robert Fogel argues skillfully for a fast-growing private health sector to accommodate baby-boomer retirements and take advantage of the breathtaking technological gains in health care. He's right. We don't need Malthusian growth-limits on health care. It's an economic-recovery sector. It even created 400,000 new jobs during this deep recession. It now employs 13.7 million people, more than the whole manufacturing sector.
But what we do need is effective consumer choice and market-oriented policies that will control the government's health care sector and prevent it from spending, borrowing, regulating and taxing us to death.
COPYRIGHT 2009 CREATORS.COM
Views expressed in this column are those of the author, not those of Rasmussen Reports.
Rasmussen Reports is a media company specializing in the collection, publication and distribution of public opinion information.
We conduct public opinion polls on a variety of topics to inform our audience on events in the news and other topics of interest. To ensure editorial control and independence, we pay for the polls ourselves and generate revenue through the sale of subscriptions, sponsorships, and advertising. Nightly polling on politics, business and lifestyle topics provides the content to update the Rasmussen Reports web site many times each day. If it's in the news, it's in our polls. Additionally, the data drives a daily update newsletter and various media outlets across the country.
Some information, including the Rasmussen Reports daily Presidential Tracking Poll and commentaries are available for free to the general public. Subscriptions are available for $3.95 a month or 34.95 a year that provide subscribers with exclusive access to more than 20 stories per week on upcoming elections, consumer confidence, and issues that affect us all. For those who are really into the numbers, Platinum Members can review demographic crosstabs and a full history of our data.
To learn more about our methodology, click here.