The subsidization of America

Today's WSJ had a story about some older guy, holding a cute dog in his lap, who was going to be "paying more" if the Republican plan to replace Obamacare came to pass. Nobody likes to hear about someone "paying more" so I read the article. Turns out he was a vet who ran a small office and who offered health insurance to his staff. But his costs would rise because he had an older workforce whose premiums would increase under the new Republican healthcare plan. What a shame, what an injustice!

This is an example of misleading news, if not fake news. Let me explain.

Older people have higher healthcare costs. That makes sense, because as you age, chances are you will experience more serious medical conditions, more often. So costs should, on average, rise. Is this news?

Well, when costs have been artificially kept lower by Obamacare, thereby creating subsidizes which are like phantom "wealth" because of the deficit-spending built into the plan, then any changes to get rid of the program are going to cause "costs to rise" for the subsidized. We were borrowing money to subsidize people which is clearly unsustainable, so when those subsidizes stop, costs must rise. We either pay those now, as we incur them, or we live in a fantasy world where someone else down the road pays for our spending today. These multiple-trillion federal debts are increasing and that must be stopped (and then the money paid back.)

If some old person, on average, incurs $50,000 in medical expenses per year, then how should that be paid? Should the person be required and expected to have saved up money to cover his own healthcare expenses as he aged, or should society cover that cost by incurring a deficit? What happens when we have trillions of dollars in debt subsidizing people because it was easy to do and there are no short-term economic or political costs to do so? When those people have passed on (i.e., died) and the debt remains, who is responsible for it? What will we do as a society when someone in the future incurs $50,000 in costs but the charge is $100,000 because we have to tack on a deficit- or debt-reduction surcharge? Will future Americans accept paying double or triple because of debts incurred by their parents or grandparents?

Here's an analogy. Imagine a program where the government gives every child virtually free daycare. Any attempt to kill such a program would result in "astronomical cost increases" for "working parents." It would "hammer" the middle class and the poor. It would force some parents to "quit their jobs" because they couldn't afford daycare. It would mean that some poor folks "couldn't afford food or medicine" because they had to spend money on daycare instead. Etc. All of these imagined headlines would be examples of Fake News.

In America, everyone gets subsidized everywhere. And woe to anyone who tries to reduce or eliminate such subsidies. Their actions "hurt" others. They are racist, mean-spirited, bigoted, greedy, selfish, etc. The fact is that we have given to our legislators the power to incur enormous debts that the public owes. Last time I checked, I believe the government debt owed per taxpayer was well over $100,000 each. Maybe it was $200,000 each. When so many people are living paycheck to paycheck, that is a lot of cash people don't have. But why stop there? Why not just keep increasing it to $300,000 or $500,000?

As I have previously written, there is a similar issue with long-term care. Radio ads ad nauseum encourage people to shield their assets "from the nursing home." In other words, get the government to pay for your long-term care so you can keep your assets and "pass them on to your children." That is called theft, my friend. But when stealing from society (the government), I guess it is legal theft. Well, who said lawyers, or lawmakers, are honest.

Instead, the WSJ article should have had the smiling face of a millennial, who was planning on buying catastrophic health insurance and saving thousands of dollars a year because they no longer had to subsidize old people. Such catastrophic plans were eliminated under Obamacare because they thought they could force the young to subsidize the old.

Here is some real news: old people are going to be paying more for health insurance and healthcare because they have higher costs. Deal with it and stop trying to find some sucker to subsidize you. (The sucker being the current and future American taxpayer, who must eventually pay back the enormous debt we have incurred providing subsidies to everybody and their mother.)


NEXT ARTICLE: Why Capitalism is so great

THE VERY FIRST ARTICLE IN THIS SERIES and a list of all articles:


Subscribe to the Acton Forum and get our newsletters emailed to you -- FREE! Click Here!