Two important things happened on Tuesday: Medicare’s trustees announced its trust fund would become insolvent in eight years; Democrats nominated multiple candidates committed to expanding Medicare to provide healthcare for more people.
Medicare’s main trust fund is now slated for exhaustion in 2026, three years earlier than previously projected. Social Security’s trust funds are anticipated to run out in 2034. “Medicare for All” has emerged as a major Democratic rallying cry while Republicans have become increasingly timorous about entitlement reform in general.
This would seem to pose a basic arithmetic problem, but the only math that matters in politics is addition to vote totals. In this area, Democrats see Medicare for All adding up.
Entrenched since President Lyndon Johnson’s Great Society, Medicare is popular while the concept of government-run, single-payer healthcare is not. The original “Keep the government’s hands off my Medicare” line was probably apocryphal, but the spirit animating it is real and has been exploited even by those who genuinely oppose enlarging the federal government’s role in healthcare when convenient to thwart Presidents Bill Clinton and Barack Obama.
Republicans as a group looked most vulnerable when they were tinkering with healthcare, while their poll numbers have improved since changing the subject. Democrats would love to change it back.
It also wasn’t lost on Democrats that the exchanges, a nominal sop to free-market healthcare reformers, were the least popular and most problematic aspect of Obamacare, while the main barrier to repeal was the Medicaid expansion. This is true even though Medicaid’s ability to improve health outcomes has been disputed.
The party had just watched Bernie Sanders do surprisingly well in their presidential primaries, despite never being elected to anything on the Democratic line, while Hillary Clinton stumbled defending Obamacare against single payer.
Democrats have memorized the arguments in favor of their government-centric healthcare vision and believed in them passionately enough to sacrifice their congressional majorities to pass Obamacare. Republicans talk about free-market alternatives but then enact Romneycare or Medicare Part D once in office and were willing to take virtually no political risks to repeal Obamacare.
Finally, many voters see a stronger connection between their healthcare and the systems of comparable countries like Great Britain and Canada, which seem to work well enough, than market-based choice options in other areas of life, such as Uber or the Starbucks app, often cited by free-market healthcare reformers. (An exception to this rule might be debt-averse former Starbucks executive chairman who may run for president — possibly as a Democrat.)
“The annual reports from the Social Security and Medicare trustees should serve as a reality check for politicians who support costly expansions of these programs,” correctly observed the Progressive Policy Institute’s Ben Ritz in a statement just hours before the Democratic primary electorate made the centrist think tank look like a 1990s relic.
When it comes to math and numbers, liberals frequently point out that many countries with a larger government role in healthcare than the U.S. spend a much smaller percentage of their GDP on it. (Unfortunately, there are fewer precedents for cutting costs by the amount it would take to get us to these other countries’ share of GDP — single-payer Medicare has certainly demonstrated no ability to do it.)
It is blithely assumed that with a tweak of the top marginal income tax rate here and a lifting of the payroll tax cap there, all these problems can be solved with scarcely anyone outside the Koch brothers’ income bracket paying for it. The role the recent tax cut played in the recent gloomy entitlements forecast will get plenty of attention, even though the long-term fiscal trajectory of these programs was little changed.
As the fine residents of Bernie Sanders’ Vermont can attest, paying for all this is not that simple.
Republicans have their own entitlements programs too, of course. After all, this is currently all happening under their watch. The party is losing House Speaker Paul Ryan, R-Wis., who ever so briefly interested GOP lawmakers in reform, and is now led by the anti-reform President Trump. More fundamentally, the electoral base that sends Republicans to Washington draws heavily from Social Security and Medicare, as do the new voters Trump is bringing into the party.
That partially explains why Trump, rather than Ryan, represents the immediate Republican future.
But when it comes to the shaky finances undergirding Social Security and especially Medicare, Democrats deny they see a hole — even as they keep digging.
