Capitalism is Not a Voucher System

Fox News online reports: “Joined by several moderate Republicans, Democrats controlling the Senate rejected a controversial House budget plan for turning Medicare into a voucher-like program for future beneficiaries. Five Republicans joined every Democrat in killing the measure, which calls for transforming Medicare into a program in which future beneficiaries — people now 54 years old and younger — would be given a subsidy to purchase health insurance rather than have the government directly pay hospital and doctor bills. Democrats said the GOP plan would ‘end Medicare as we know it,’ and they made it the central issue in a special election Tuesday in which Democrats seized a longtime GOP district in western New York, rattling Republicans.”

Wow — if people don’t like the idea of turning Medicare into a voucher program, imagine how

they’ll feel when … there’s no money left for Medicare at all, unless the entire private economy is sacrificed to mega-inflation, 100 percent tax rates or anything else impossible to contemplate.

This vote, coupled with the declining fortunes of Republicans based on various polls and special elections, reveals the sad truth: That Americans are in complete denial about the unsustainability of their Medicare.

Paul Ryan’s fatal mistake isn’t his voucher program for Medicare. His fatal error was in refusing to challenge Medicare, or any socialized medicine, on moral grounds. He should have argued, “Medicare is wrong. It’s socialized medicine for the elderly. Hospitals and doctors cannot even remain in business so long as Medicare keeps eating up all the costs. The reason Medicare is so expensive is that it’s a freebie, to which people told they’re entitled.” If he had argued this, he would have gone down like a lead balloon. But he’s going down like a lead balloon anyway. If there’s anything worse than being wrong, it’s being right — for the wrong reasons. That’s Paul Ryan.

The story at Fox News online continued: “Critics [of the Ryan plan] point to a nonpartisan analysis by the Congressional Budget Office predicting the [Ryan] House Medicare plan would pay a shrinking share of seniors’ insurance premiums over time and would lead them to either choose policies that offer less generous coverage or force them to pay thousands of dollars a year in higher premiums to maintain the coverage currently offered by Medicare.”

Does this mean that Medicare is fine and sustainable, if you just leave it alone? The CBO hasn’t claimed that, either. The CBO has repeatedly stated that Medicare is going broke, sooner than any of the politicians will admit — especially with our continuing recession. Medicare has become really, really expensive because it offers unlimited benefits to everybody, indefinitely into the future. It’s way past bankrupt, and it’s approaching the point where it will paralyze the entire government. This isn’t even counting in Social Security and the forthcoming ObamaCare monstrosity. Medicare alone will crush the government, particularly once the number of senior citizens in the country increases over the coming decade. And what about this 10 percent unemployment rate? If that continues, or worsens, how are all the young and middle-aged people to pay for this program? The money has to come from somewhere, doesn’t it? To forcibly transfer money from younger Peter to pay for older Paul, doesn’t Peter need to be making a good salary?

It’s painful to watch Rep. Ryan be punished for the wrong reasons. People perceive him as privatizing Medicare, and they will have none of it. In truth, he’s proposing no such thing. He’s simply suggesting that government continue to provide unlimited, free health care to senior citizens — on the backs of doctors, hospitals and younger citizens — through a different method of payment. The hope is probably that vouchers will turn Medicare into a free market hybrid. But that’s foolishness. This would be like the government saying, “Free food for everyone tomorrow.” No, the government wouldn’t take over all the grocery chains. The government would simply transfer trillions of dollars to the population to pay for food at the grocery stores of their choice. How long would this last, before the government ran out of money? That’s already happening with Medicare as we know it, and under Ryan’s voucher system the whole situation could even get worse.

Capitalism is not a voucher system. Capitalism does not consist of a third party giving billions of dollars to one group, and then telling that group to spend the money on a product or service with no moral hazard, and no rational accountability. Politicians cannot do this and then proclaim, “Look at me, I generated economic activity!” And they cannot expect people, once given trillions of dollars of other people’s money, to spend it prudently.

Americans will hear none of this. “Preserve my Medicare,” they scream. “Just reform it.” It’s literal madness. Instead of facing reality, we’ll have to watch the deficit balloon by trillions and trillions of dollars, and watch the politicians start to transfer money from people who will be born in the twenty-fifth century, instead of the twenty-third century, to pay for it all.

If you were on the sinking Titanic, would you step into a leaky lifeboat or would you hold out for possibly finding one that will stay afloat? Yes, you could die by waiting for a better lifeboat — but you’re going to die anyway, if you get on the leaky one. It’s the same with Medicare. All hope to “save” the program from the nature of its inherent unconstitutionality, and resulting bankruptcy, is the equivalent of getting into a leaky lifeboat. Of course, the great majority of the Titanic’s passengers, where Medicare is concerned, are going about their business as if nothing is wrong. That’s the bigger problem for those of us who don’t want leaky lifeboats, but who likewise cannot ignore that the Great Ship of the welfare state is sinking.

It’s tempting to wait for a real rescue — not Paul Ryan, but a real one. But how can you rescue a ship full of passengers who refuse to even  believe the ship is sinking?

“End Medicare as we know it”? They’ve got to be kidding. Paul Ryan cannot do that. Medicare is doing it to itself.