For reasons that are probably more my own fault than anything else, I’m sort of obsessed with nitpicking things Matt Bai writes. So let me take another pass at his NYT Magazine piece on think tanks and focus on a section highlighted by Mark Schmitt:
Take health care, for example, where Democrats have succeeded in proposing long-needed fixes to the employer-based system of the 20th century — at exactly the moment that we should be considering the needs of a new century’s work force, for whom the link between the workplace and the doctor’s office seems increasingly irrelevant. (The one bill that would take apart the old, employer-based model without resorting to a government-run solution, a bipartisan proposal from the Democratic senator Ron Wyden and the Republican senator Bob Bennett, has been largely ignored in Congress.)
Two things about this. One is that I never like framing of the desirability to break the employer-insurance link that implies that at some historical point (“the 20th century”) this was a good idea, but only now (“the needs of a new century”) should we consider something different. The fact is that America’s health care system was worse than France’s or Canada’s in 1980 just like it is today.
The other is that Wyden-Bennett fans in the commentariat (I’m thinking primarily of Dylan Ratigan, but Bai is clearly in the same boat) have developed a habit of massively understating the transformative potential of the Obama administration’s health care proposals. It’s true that Obama shies away from a Wydenesque sudden shock to the employer-based system. But Obama does that because even though journalists and think tankers tend to favor such a sudden shock the public hates that idea and is terrified of it and nothing any politician says is going to change that. What Obama’s plan does accomplish, however, is to set the stage for a phased transition to a system in which employers are cut out of the loop. It’s important to recognize that the employer-based system has been slowly unraveling for 10-15 years anyway. Reform, by creating a viable individual marketplace, will both eliminate the pain associated with that unraveling process and also to an extent speed it since people will stop making employment decisions based on the idea that it’s extra-desirable to sign up for an employer large enough to offer an affordable group plan.
On top of that, the Obama reform plan will, via the excise tax, over-time phase-out a substantial tax subsidy for employer-provided insurance. In combination with the creation of a viable individual market, this will encourage employees to ask employers to give them more money and less health insurance, secure in the knowledge that they can buy insurance for themselves in exchange for money—insurance where they get to pick the provider rather than being stuff with whatever the HR department wanted.
I agree that in principle it would be better to shift to a better system faster but honestly in the scheme of things the pace of transformation here is not very important. The fetishization of Wyden-Bennett’s rapid change seems like just a sublimated version of fetishizing bipartisanship. I bet that if the situation was reversed and the President was proposing a sudden shift while Bennett’s name was on some legislative draft to initiate a phased transition, that we’d be hearing Bai and others complain that liberals were moving too fast and ignoring the sensible bipartisan alternative. No less an authority than Ron Wyden recognizes that the current reform plan constitutes a valid means of achieving Ron Wyden’s policy objectives.