Yuval Levin and I disagree about a lot, but the truth contained in this chart is a profound one:
All the negotiations about this and that aside, over the long-term, budget policy is about health care policy. We need to choose some combination of the following options:
— 1. Higher taxes.
— 2. Systematic change to the cost structure of American health care.
— 3. Abandonment of the government’s commitment to provide health care to the poor and the elderly.
Government-provided health insurance is obviously more expensive to the government than is simple failure to provide it. But I think the fact that the government has a substantial cost advantage over the private sector when it comes to the provision of health insurance is a good reason to shy away from option (3). We ought to seek to improve the systematic cost-efficiency of the health care system, and then we ought to pay in higher taxes what it costs to provide what that gets us.