Barack Obama versus George Will

Sunday, George Will issued a column on the public option.  In this column, he argued that public option would drive the private insurance industry out of business.  Among other things, he wrote:

Assurances that the government plan would play by the rules that private insurers play by are implausible. Government is incapable of behaving like market-disciplined private insurers. Competition from the public option must be unfair because government does not need to make a profit and has enormous pricing and negotiating powers. Besides, unless the point of a government plan is to be cheaper, it is pointless: If the public option conforms to the imperatives that regulations and competition impose on private insurers, there is no reason for it.

That struck me as bizarre (I'm thinking of the Postal Service here).  Anyway, it struck Obama as odd as well.  Check out his response to the following question:

QUESTION: Wouldn't that drive private insurance out of business?


OBAMA: Why would it drive private insurance out of business? If — if private — if private insurers say that the marketplace provides the best quality health care; if they tell us that they're offering a good deal, then why is it that the government, which they say can't run anything, suddenly is going to drive them out of business? That's not logical.


Now, the — I think that there's going to be some healthy debates in Congress about the shape that this takes. I think there can be some legitimate concerns on the part of private insurers that if any public plan is simply being subsidized by taxpayers endlessly that over time they can't compete with the government just printing money, so there are going to be some I think legitimate debates to be had about how this private plan takes shape.


But just conceptually, the notion that all these insurance companies who say they're giving consumers the best possible deal, if they can't compete against a public plan as one option, with consumers making the decision what's the best deal, that defies logic, which is why I think you've seen in the polling data overwhelming support for a public plan.

I think Obama is correct to the extent that non profit companies compete in a free market all of the time.  Many hospitals don't need to make a profit, some insurance companies are essentially non profits.  I suppose the only remaining thing is the size.  But, as Obama correctly points out, a large number of people seem to favor that kind of insurance arrangement.  It would seem to be an odd limitation on their freedom to shut off that option.  

9 thoughts on “Barack Obama versus George Will”

  1. How about the reporter who derisively called this response “Spock-like” because it included the word “logic?”  Apparently the American presidency is above logic now.

  2. Thanks for the tip.   The journalist seems to be Jake Tapper of ABC, and he’s being praised all over the place by right wing blogs for his comment.

  3. John, I hear you; however, the argument I keep hearing is the following:
    1) The government is incapable of behaving like market-disciplined private insurers.
    2) Marked-disciplined private insurers need to make a profit to remain in business.
    3) The government does not need to make a profit.
    Therefore, the government has an unfair advantage to the rest of the industry.

    In other words, doesn’t matter how inefficient (financially) this program will be, because the government can always raise the taxes and cover the expenses.
    I think President Obama understands very well the complete argument: “I think there can be some legitimate concerns on the part of private insurers that if any public plan is simply being subsidized by taxpayers endlessly that over time they can’t compete with the government just printing money, so there are going to be some I think legitimate debates to be had about how this private plan takes shape.”

    Again that word: “some”. I think Mr. Obama is committing a straw-man argument here. 
    He’s putting aside the “legitimate concerns” and argues against an incomplete argument.

  4. Will’s argument, BN, has no basis in fact: many countries with universal single payer coverage (Will’s most extreme case) have for-profit insurance plans as well.   There are many models of universal coverage, and it’s silly to think they’re all some kind of “socialized”  one health plan for all type.  There’s your straw man.

    All of this, of course, is a silly distraction from the well established fact that Americans pay way more for health care and get far less than comparable nations.  Way to go private insurance!  I think we need a more effective solution–one that addresses the disparity issue, the inexcusable existence of the uninsured, the still crippling fees and costs insured people (and society) face, and finally, the limitations employer-based insurance puts on small business.

  5. John, our health care system is a mess. I think most people agree on that.
    But then again, you look at Medicaid and Medicare, and you can make an argument that those 2 government programs are worst than any private insurance.
    But back to your point, I think that even the “public option” is more of a distraction from the root cause of all this mess. We need, “a more effective solution”, as you call it.
    It looks like public opinion is with Obama on this. However, it seems that the public is almost clueless as what this “public opinion” actually means.
    This reminds me of the stimulus package debate: the devil is in the details.
    And one important detail to George Will is that the single payer coverage will mean the end of for-profit insurance plans. Is George just lobbying here for the insurance companies? Or is he just making the case that by loosing the existing insurance plans, we’re loosing something more? Fifty-eight percent of those with health insurance coverage are extremely or very satisfied with their current plan, and approximately one-third (30 percent) are somewhat satisfied.  Only 11 percent say they are not too or not at all satisfied

  6. The fact that so many people with insurance are so satisfied arguably undercuts the case AGAINST a government plan: If the private plans are so good and satisfying, then clearly they will be able to compete against the inefficient and “obviously” bad government option. Even if the government plan is economically cheaper, people will still turn to their private plans for the greater satisfaction.  Kuppenheimer has not driven Armani out of business.

    On the other hand, what is the basis of comparison that those people who declare their satisfaction are using in order to derive their conclusions? Acknowledging the inherent weaknesses of anecdotal arguments, still I would note that if I even had insurance I’d likely be very happy given the alternatives. Also, of those 58% how do they break out according to actual claims for insurance? That is, how many of those happy 58% have had to rely on their insurance in a big way? I was pretty happy with the insurance I had (when I had it) until it started sending back legitimate medical bills claiming these represented pre-existing conditions. I would also be interested in learning about the larger economic status of that 58%. Is there a correlation between satisfaction and income bracket?

    Finally, we’re talking only  58% of those who actually have insurance. Perhaps I do  not properly understand how the statistics of such things work, but that strikes me as rather shockingly low. Do we know how that compares with the level of satisfaction in places like Canada, UK, France etc?

  7. Gary is right.  It’s difficult to gauge the “satisfaction” meter without more background knowledge.  But I would repeat again a couple of points you seem to have missed, BN. 

    1.  Single payer health coverage (what I would support) does not eliminate for profit health care.

    2.  Very few people NOW get to pick their health plan.  Their employer (should they be lucky enough to have one) picks it for them.  Changing that plan, then, is not up to them at all. 

    3.  I’m not certain that medicare and medicaid are a mess, as you suggest.  But even if they were, many countries have public plans (of varying types) that work absolutely fine.  Moreover, those plans cost less than ours and cover more. 

    4.  None of this is an argument for whatever it is Obama is offering.  These are just rebuttals to silly objections.

    5.  We should, as you suggest, have a real debate about health care.  One that starts with the fact that we pay so much and get so little compared to everyone else.

  8. Yes, the satisfactory poll is a little unsatisfactory. Like Gary correctly points out, you might be happy that you have something rather than nothing.

    John, as always, thanks for your patience.

    The only 2 objections I have so far about this “public option” are:
    1) I don’t agree with president Obama on rushing this thing. It’s not a wise thing to rush things, especially something as important as health care.  Take however long is needed, but do it right.
    2) He seems to be reluctant to make any changes to our current medical liability system. Now, this report makes this claim about the success of this reform:  “California has more than 25 years of experience with this reform. It has been a success. Doctors are not leaving California. Insurance premiums have risen much more slowly than in the rest of the country without any effect on the quality of care received by residents of California. Insurance premiums in California have risen by 167% over this period while those in the rest of the country have increased 505%. This has saved California residents billions of dollars in health care costs and saved federal taxpayers billions of dollars in the Medicare and Medicaid programs.

  9. If I had to bet, I would guess that the 58% of people who are happy with their health care are people who receive their health care through work. I’m pretty happy with mine, I have a very low contribution (though family rates are just sick) and I get, so far, what I need, when I need it.

    Of course, I don’t see the 6K that my employer is sending to an insurance company each year, so it’s sort of magic to me.

    I bet that if we forced the cost of health care out into the open, those 58% would be freaking pissed off (6K for one lousy check up each year!!!!!).

    I’m worried about the idea, but I wonder whether we’ll ever get decent health care reform without ending the employer based system. Or, maybe a better way of thinking about it is that things are so bad, that even with “magic health care” for a lot of us, 70%+ think we should at least have an alternative to the employer based system at this point.

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