Sunday, March 21, 2010

Democrats usher in new era of freedom and security (at the expense of constitutionality?)

Note: As you read this, you may be tempted to call me partisan or left-leaning.  However I respectfully ask you to withhold the urge to slot me into a simple political perspective as you read through this.  This analysis is my best attempt to look at the health care reform bill on the merits and demerits, with my personal bias towards proactive problem solving, as well as my bias for effective leadership.

While certainly full of problems that come with any large initiative or legislation that enables substantial change, the expansion of access to health care for Americans will, indeed, spread freedom and security throughout the land.  Here's how:
  • By outlawing pre-existing conditions, Americans will have more freedom to leave insurers, change insurers, and select insurers. 
  • Americans will be free to tell the truth about their pre-existing conditions (instead of lying about not having any so that they can have insurance). 
  • Americans will be free to leave or change employers, and choose from a larger swath of employers (esp. small businesses).  Thanks to serious tax-payer subsidies, more people will be able to afford insurance without needing it to be an employer-based benefit.
  • Just like our military uses our tax dollars to ensure our security and safety, so will this legislation.  The military is all about keeping us alive and free.  So will this health insurance reform legislation.  As a country, we've time and time again decided that our tax dollars are well worth our safety, security and freedom.  This is no exception.
  • Americans just got a new "benefit" just for being an American.  Just like any good employer provides good benefits to its workforce, a good country delivers good benefits for its citizenry.  
However, it's not all butterflies and roses.  Unlike prior "social justice" measures that progressives have led throughout history, there is a serious liberty loophole in the legislation as I see it:  The individual mandate, which forces Americans to buy insurance or else get fined by the government, may be unconstitutional.  At a minimum, it's unprecedented:

Never before has a federal law forced a citizen to buy a product from a private company.* 

(*as far as I know -- if you know of precedent for this, please add to the comments below)

Democratic defenders will typically respond to this critique with the question: "How is that any different from being forced to buy car insurance?"  Well, in two ways, but only one is important:  No American is forced to buy a car.  The secondary reason is that car insurance mandates are regulated at the state-level, not federal.  Ironically, if the so-called "public option" were part of this legislation, I don't think there would be a constitutional issue at hand.  After all, there is a lot of precedent of the government forcing Americans to buy things from the government.  So, with a public option, an American would merely be forced to buy something from the government -- which is far closer to a tax than anything else.  But this compromise that forces Americans to buy something from a private company really seems constitutionally troubling, and is philosophically at odds with a mainstream view of the reach of government.  

But is this the right legislation?  Well, we can look at almost anything and pick it apart.  Give me an hour, and I'll give you two hours of critiques of any organization out there, their products, their services, etc.  Everyone's a critic.   Regarding this bill specifically, outlawing pre-existing conditions is tricky business for an insurance company from an actuarial perspective.  And mandating that all businesses with 15 or more employees offer health insurance will have a heaping spoonful of unintended consequences in the shape of the rise of temporary workforces.   And the fact that it doesn't substantially affect the cost or delivery of health care seems like a pretty big miss. 

Of course there are better ways to solve this problem than this bill prescribes.  But there are better ways to do just about anything.  And if you have ever worked with or in a large organization, you'll know from your own experience that large organizations require large compromises to get anything of substance done.  Large projects never launch on time, and never include all the things that should be in there.  There are often too many competing priorities, limiting the 'perfection' of almost anything, and instead focusing on the important bits that keep you just competitive enough to compete another day.  So, while this legislation is far from great in terms of its elegance and ability to reform health care cost and delivery, it certainly accomplishes meaningful progress in the tactical-yet-important-to-many-people spheres of access and affordability (via subsidies). 

In short, this legislation is not a "government takeover of health care" as the Republicans have so effectively mis-portrayed the plan over the past year.  Rather, it's a real expanded role of government -- an expansion that adds new responsibilities to the federal government for ensuring that its citizens have access to the care needed to keep themselves alive. 

You may or may not think this is the proper role of government.  You may think this will help or hurt our economy.  You may think that socially funding access is bad for the economy.  You may even be with me in thinking that its specific implementation could prove to be unconstitutional.  In one way or another, these are all debates that we've had over the past year.  But what is not debatable is that this legislation will enable new levels of freedom of employer choice, new levels of insurance provider choice, and new levels of health security for Americans.

Monday, March 15, 2010

Democrats: Just don't pretend you're not squeaking health care reform through

Democrats can sometimes be like Republicans and not realize how their approach to getting what they want can be seen as so brazen by those who don't buy into what they're doing.  Case in point: Health care reform bill passage.
Yes, the Dems did get a 60-vote majority in the Senate last year.  This 'officially' gives the House something to sign-off on and then send to the President to sign into law.  But, the 60-vote majority only came by literally buying off Senators and states with all kinds of unsavory deals.  Yes, I know -- unsavory deals are part of the legislative sausage making.  But these deals are really shabby.  Needless to say, without these deals in place, there would not have been 60 votes. 

Yet, there are 60 votes to work with.  But the House doesn't much like the sausage they are being delivered, so they want to modify it, improve it, and make it more tasteful so that they can get re-elected, too.  Unfortunately for Democrats, the nature of the Senate has changed and there will no longer be 60 senators ready to pass any new provisions the House introduces.

So, the Dems are stuck.  But not procedurally.  They have a solution.  It's perfectly legal and legit, but it's a procedural solution that feels like the back-alley way of getting to the next intersection.  Yeah, you'll get there.  But it won't be pretty, and it certainly won't be in style.

So, here's how it's going to work: The House will hold their noses, cross their fingers, and pass the smelly stinky, Senate bill as it stands today.  The President will sign this into law, and then the Senate will use a process called reconciliation (a straight majority process designed to tweak budget-level items, but not designed to set policy) to address all the concerns the House had with the bill they just passed -- including getting rid of all the give-aways and smellier parts of the bill that they just passed.  Reconciliation requires a straight majority vote: 51/49.  Much easier to pass than the super-majority votes for policy.  Once Reconciliation is done, the latest and greatest health care reform bill will be good to go. 

In other words, Health Care Reform 2.0 will be released within hours or days of 1.0.  This may be the fastest re-release in legislative history.

The end result will look very similar to the plan that President Obama introduced in February.  It will be better than the original Senate bill, but it will take the equivalent of legislative whiplash to get it there.

The Dems are pretty stoked that they can work this out.  And their fans are pretty happy that the Dems are finally ready to play to win.  But when the Republicans "play to win," Democrats cry foul.  This is hypocritical.  Most people would not be very surprised to see Republicans be as scrappy and savvy as feasible to win -- that's part of their brand.  But Democrats like to think of themselves as higher-order people -- people who don't have to play games to win.  In the case of passing health care reform, Democrats may be playing by the rules, but so did the Bush Administration when they made their case to go to war with Iraq. 

Sunday, March 7, 2010

Reading the signs

The media generally wears political bifocals... they can see clearly only when they fit into the pre-determined focal lengths: left vs. right, Dem vs. Pub, big vs. small, partisan vs. bi-partisan.

While this creates clarity and surety (attributes that people prefer in our cultural narratives), it doesn't always serve us well.  Sometimes, there are complex dynamics at play -- dynamics that are "messy."  And when political reporting skirts these complexities, we get the equivalent of listening to music in "mono" (vs. stereo), or watching a television show in black & white (vs. color).  We lose critical dimension that tells us a lot more about what we're observing. 

In the most recent incident of this bifocalization of politics, the narrative has been painted opportunistically by the Republicans that, well, Democrats are back in power... and look at how they spend your tax dollars!  

And Obama and the Democrats fell into the that brand trap so easily and readily, it's almost as if they hadn't been aware of their brand problems regarding spending and taxes over the past, say, 40 years. 

So, predictably, the media "reports" what the Republicans decry, and with no meaningful counter-narrative from the Democrats, the dye has been cast in the media's eyes: Obama's popularity is fading because of how he mishandled the health care reform debate, and that he didn't focus enough on "jobs, jobs, jobs."

But, there is a lot more color around the politics du jour than is being painted.  There are many sources of social noise that simply can't be located when listening to politics in mono. 

What is really at issue here is a trend that has been tragically under-reported:  the economic shift that started in the early 1990s and continues at a rapid pace today:  the globalization of the economy.

"Outsourcing" has been the evil mask we're affixed to this overarching dynamic.  The populist media found an easy, comprehensible target and flooded our national narrative with outsourcing as the evil face of globalization.

Yet the outsourcing of jobs to developing countries is merely one facet of globalization's impact.  The more systemic and troubling development (at least, for America) is that with capitalism, markets tend to become more efficient, and find equilibrium.   And as we continue to embark on global capitalistic endeavors and trade deals, America's disproportionate high standard of living is rubbing up directly against standards of living that, on average, are far, far lower almost anywhere else in the world.

The result?  In an open, transparent market, America's standard of living is guaranteed to be reduced in the face of open competition from lower standard of living regions and countries.   We as Americans -- especially the politically potent of us -- are hooked on affluence.  We believe as a culture (many religiously) that we are destined and chosen to live more secure, happier, plush lifestyles simply because we are American.  

But since the early 1990's, reality is creeping up on us.  Our global economic and moral hegemony is on the decline, and all we can really do is just hang on and try to delay the slide for as long as possible.

Which is why we have become so gosh-darned conservative and economically imbalanced over the years.  Avoiding an uncertain and unflattering future is a conservative stance.  And while most people would never articulate their fears and concerns the way I just did, I believe that people intuitively understand what's going on.  But what they are doing politically is the equivalent of putting their fingers in their ears and screaming "la la la la la!" so as not to address these issues head-on.  Because no matter what we do, the issues are going to reduce our standard of living for a long time -- and possibly permanently.

The irony is that a decline in our aggregate lifestyle will be the best thing that ever happened to this country.  Our country has become a singularly-focused culture on wealth, wealth creation and wealth protection.  This is quite unhealthy socially, and we are seeing the results of this social obesity throughout our system.  People are much richer, yet much less happy.  People have less time to enjoy life.  Parents have less time to raise their children.  Americans are becoming historically obese and overweight.  Our culture of convenience has made us generally more lazy, and less fulfilled.  And it can't existentially or morally be fulfilling when the affluent feel increasingly victimized by taxation as they turn a blind eye toward the plight of the poor and working class. 

Nevertheless, nobody wants to slide toward less affluence, less protection and less economic freedom.  Yet that is where we're heading.  And it's because of this macro-social-economic trend that President Obama is having a difficult time running the country.  Wall Street, realtors, small and large businesses alike are all on the lookout and grasping for the next scheme they can latch onto on the way down the economic slide -- any scheme that will prop them up long enough so that they can cash out and surf the decline in relative style. 

You can't really blame these people and institutions for trying to scour the system for a few last-minute jackpots.  It's the natural thing to do.  And you can't really blame our political leaders for not being honest with us about the situation at hand (who would win on that platform?).   But I'd argue you can blame the media for not making this the narrative that we all need to discuss and chew on as a culture.  At length.  Only after mainstream America understands and comes to grips with the future will we have the fortitude to look for political leaders who will need to deal with the future as it's going to be -- not sell us a lie about our future.

I want to point out that I am not being a pessimist.  I believe very strongly in the power and capability of Americans to innovate and create new, unprecedented value in the global marketplace.  And I believe that our military might will keep the country quite relevant on the global stage.   But our ability to innovate and create new economic value has very little to do with the global lifestyle equilibrium being so out of whack for so long.  With global trade, the equilibrium will inevitably slowly converge, with developing countries trending up toward average, and America trending down toward average. 

This trajectory will be very good for the people in the world.  More people will be lifted out of poverty as a result.  We are embarking on a historic transfer of wealth from America and The West to developing markets. And it's happening through the free markets and increasing trade -- not some socialist agenda.