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Home Publications Blogs Beat the Press The New York Times Thinks That Congress is Full of Philosophers

The New York Times Thinks That Congress is Full of Philosophers

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Sunday, 03 April 2011 07:30
The New York Times apparently missed the elections last fall. This is the only possible explanation for its assertion that the budget debate in Congress:

"is likely to spur an ideological showdown over the size of government and the role of entitlement programs like Medicaid and Medicare."

The people serving in Congress got their jobs because they are effective politicians. This means that they have the ability to appeal to powerful interest groups; there is no requirement that they have any background in, or adherence to, any political philosophy. 

The debates over competing plans for Social Security, Medicare, and Medicaid are most obviously about the distribution of income between the wealthy and the less wealthy. Most Republican plans for Social Security would substantially reduce benefits for middle-income, and sometimes lower-income, retirees. Democratic plans tend to be more likely to increase taxes on the wealthy. This is most immediately a question of whether money should come out of the pockets of middle-income people or wealthy people.

In the case of Medicare and Medicaid, the most obvious issue is between those who would want to revamp the health care system in ways that give less money to the pharmaceutical industry, physicians, and insurers, thereby bringing per person costs in the United States more in line with costs in the rest of the world, and those who want to protect the income of these interest groups and instead save money by denying health care to people. There could also be more taxes on the wealthy to support the maintenance of quality health care for the aged and the poor. 

It is inaccurate to describe this as an ideological issue or a debate over the role of government. Both paths involve large roles for government. In the case of the Republican path, the government must play an intrusive role in protecting the patent monopolies of the pharmaceutical industry which allows them to charge prices that can be hundreds or even thousands of times the competitive market price. The same applies to the medical device industry. The government also imposes extensive barriers that keep doctors' fees far above those of comparably trained physicians in other countries. 

The debate is not over whether the government should play a large role in the health care sector. The debate is whether the government's efforts should be devoted to maintaining the incomes of health care providers or whether they should be devoted to providing health care to the public. The NYT badly misrepresents the issue in a way that strongly favors the Republican position by implying that this is an ideological argument over the size of government in the economy. It isn't. 

Comments (11)Add Comment
Dean Baker is No Kenneth Arrow
written by izzatzo, April 03, 2011 8:30
The debate is not over whether the government should play a large role in the health care sector. The debate is whether the government's efforts should be devoted to maintaining the incomes of health care providers or whether they should be devoted to providing health care to the public.


Whose Your Nanny Baker criticizes the NYT for framing the issue as an ideological showdown then issues the mother of ideological ultimatums - either way the government must play a large role (since competition apparently has no role due to market failure of health care.)

Who do you think you are Mr Nanny, Kenneth Arrow?
...
written by paine, April 03, 2011 10:18
izzatzo

are u trying to make sense here ??

the debate framed up on the hill
is precisely between
two competing and opposing
(different reference class based )
notions
of
just how uncle might best help ...me errr us
and not them

are you one of those uncle Sam's
private market footprint
needs a down sizing types ??
and you are so bursting with the gospel
u just can't control your flatulence ??

and btw
why drag poor ken arrow into your flesh pot ??

------------------
" competition apparently has no role due to market failure of health care "

apparently to who ??

i take this to be
an incoherent wise crack
but on a flyer and to pursue dialogue
with some one who is " apparently"
a denizen here
i'll assume a coherent constructive intend

if i assume wrong
that just puts all the more force behind
the call for greater clarity and coherence


you fail to see a convergence here

a state designed market mechanism

that done correctly
can often both retain free choice
and enhance competition

existing markets don't spontaneously form
into optimal structures

believing that they can ..let alone ..do
form into optimal structures
---one guesses by some yet undiscovered
law of inherent interactive dynamics---

at any rate
so long as the rat race of rent seekers
that collect with equal spontaneity
are cleared away from the lobby's of gubmint

this hopeful simplicity of vision
is a faith based only

a conviction without a science


...
written by izzatzo, April 03, 2011 10:58
a state designed market mechanism

that done correctly
can often both retain free choice
and enhance competition


Touche, a pleasure to be taken down by a maestro of the gad flies that zip themselves with wordwrap couched in the punctuated broken prose of one who writes so efficiently not a letter is wasted and understands as does Baker who the nanny serves.
gad flies and nanny states
written by paine, April 03, 2011 11:29
"who the nanny serves"?
yes that's the key
but of course we first need a pretty good
grasp of who the nanny state can serve ??

i'm prepared to suggest
since the end of WWII
our dear nanny state
only served and now only knows how to serve our robust corporate cliques

to serve the people ???
how ???

we have the dean here a voice and
many other voices
some organized into outfits
but lurking largely on the margins
not at the margin

we got the unions god bless em

and ..


..oh hell its sunday
time for us job shackled souls
to rest our bodies and our heads
...
written by izzatzo, April 03, 2011 12:38
our dear nanny state
only served and now only knows how to serve our robust corporate cliques


Please do elaborate, for this is libertarian trap into which liberals become hopelessly entangled by virtue of seeming agreement from the right that government has no business taking over and rescuing General Motors, the banks a la TARP, etc.

To hear the teabaggers tell it from fifty thousand feet, they could be spreading the gospel of the Dean, no?
What would Terry Jones or Donald Trump Do?
written by Union Member, April 03, 2011 2:33
The New York Times carved out precious space in its pages for two other American political philosophers, giving a "He Said" megaphone to Donald Trump and Terry Jones. (sharing the same dateline as Carl Hulses piece of the Budget Battle.)

There is even a piece on how unemployment will go up now that the death penalty has been abolished in Illinois.
What is the mechanism for keeping doctors' fees high?
written by Yoram Gat, April 03, 2011 6:27
You write:

> The government also imposes extensive barriers that keep doctors' fees far above those of comparably trained physicians in other countries.

Could you provide a link or more information regarding these barriers? I am aware that doctors are by far the highest earning sector in the economy (http://www.bls.gov/oes/current/oes_nat.htm#29-0000)and I am wondering why this is so. Can you provide any details? Thank you.
keeping doctors' pay high
written by Dean, April 03, 2011 6:39
Hi Yoram,

You may want to look at this http://www.cepr.net/index.php/...l-services

be sure to look at the supplemental paper on restrictions by state.
Thank you very much, Dean
written by Yoram Gat, April 03, 2011 7:05
I'll be reading this report and the supplemental material.
Ok - I read the report and supplemental paper
written by Yoram Gat, April 04, 2011 12:05
This is quite interesting and relevant to the matter of so-called free-trade agreements.

But aside from the matter of protections from foreign competition, entry barriers must also exist for preventing too many locals from entering the lucrative professions. If your models in the paper are any indication, even a modest increase in the number of professionals may cause significant decrease in the professionals' earnings.

Again, I am thinking particularly about doctors, whose earnings are much higher than those of lawyers and accountants and whose earnings are a major part of the escalating cost of healthcare. How is this achieved?
...
written by liberal, April 04, 2011 7:17
Yoram Gat wondered,
Again, I am thinking particularly about doctors, whose earnings are much higher than those of lawyers and accountants and whose earnings are a major part of the escalating cost of healthcare. How is this achieved?


I don't have the time to research the web and come up with actual numbers and documents, but there are a few means:
(1) Limiting the number of medical students in the US
(2) Preventing medical professionals who are not doctors (e.g. nurses and physician assistants) from expanding their roles in the medical sector

While I'm in favor of physician licensure (cf Milton Friedman---I think his argument against it was his PhD thesis or one of his earliest papers), it's standard economic theory that such a policy regime will lead to rent seeking, thus higher salaries.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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