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Ezra Klein writes at the Washington Post:
In 1991, economist Mark Pauly was the lead author of a Health Affairs paper attempting to persuade President George H.W. Bush and his administration to adopt a universal health-care proposal that would keep the government from eventually taking over the sector. “Our view is that excessive government intervention will make matters worse,” wrote Pauly and his co-authors. “Our strategy, therefore, is to design a scheme that limits governmental rules and incentives to the extent necessary to achieve the objectives.”
At the heart of that strategy was the individual mandate, which would go on to be promoted by congressional Republicans, the Heritage Foundation, and Massachusetts Gov. Mitt Romney before being adopted by Democrats and becoming a bete noire of conservatives. I spoke to Pauly earlier this afternoon, and an edited transcript of our conversation follows.
Tell me about your involvement in the development of the individual mandate.
I was involved in developing a plan for the George H.W. Bush administration. I wasn’t a member of the administration, but part of a team of academics who believe the administration needed good proposals to look at. We did it because we were concerned about the specter of single payer insurance, which isn’t market-oriented, and we didn’t think was a good idea. One feature was the individual mandate. The purpose of it was to round up the stragglers who wouldn’t be brought in by subsidies. We weren’t focused on bringing in high risks, which is what they’re focused on now. We published the plan in Health Affairs in 1991. The Heritage Foundation was working on something similar at the time.
What was the reaction like after you released it?
There was some interest from Republicans. I don’t recall whether they formally wrote a bill or just floated it as an idea [It did make it into a bill -- Ezra], but Democrats in Congress said it was “dead on arrival.” So that was the end of my 15 minutes.
Was the constitutionality of the provision a question, either in your deliberations or after it was released?
I don’t remember that being raised at all. The way it was viewed by the Congressional Budget Office in 1994 was, effectively, as a tax. You either paid the tax and got insurance that way or went and got it another way. So I’ve been surprised at that argument. But I’m not an expert on the Constitution. My fix would be to simply say raise everyone’s taxes by what a health insurance policy would cost — Congress definitely has the power to do that — and then tell people that if they obtain insurance, they’ll get a tax break of the same amount. So instead of a penalty, it’s a perfectly legal tax break. But this seems to me to angelic pinhead density arguments about whether it’s a payment to do something or not to do something.
That gets to one of the central questions in this argument, which is whether the individual mandate is a penalty for economic inactivity or whether it’s part of a broader system of regulations affecting a market for health care that we’re all participating in, whether we’re buying insurance that day or not.
I see it in the latter way. We thought it was a good idea to do everything possible to encourage people to get insurance. Subsidies will probably pick up the great bulk of the population. But the point of the mandate was that there are a few Evil Knievals who won’t buy it and this would bring them into the system. In our version, the penalty was effectively equal to the premium of a policy. You paid the penalty and you got the insurance. That’s one of my puzzlements here: In the new law, the actual level of the penalty is quite small compared to the price of a policy. It’s only about 20 percent of the cost of a policy.
His puzzlement is due to his belief that Republican objections are rooted in some principle. They are not. Republicans have no policy beliefs. They are animated simply by partisanship and resentment. This bill was proposed by a Democrat, so Republicans claim it’s tyranny, regardless of whether or not it’s based on ideas that they themselves had proposed for the past few decades. The end.
Amen, Elvis.
ditto Elvis
No, it has not been something “Republicans” proposed for the past few decades. It hasn’t been seen nationally since the GHWB Administration. Mitt Romney is in trouble, with Republicans, for embracing the idea on a state level. It is a stupid, unconstitutional move and people who propose it don’t belong in federal office.
Let’s presume that you are right and that it is, in fact, unconstitutional to tax people who don’t purchase health insurance. What is the outcome of taxing people who don’t have health insurance? The answer: people who purchase health insurance have a lower tax liability than people who don’t purchase health insurance.
Let’s consider the alternative proposed by Mr. Pauly: tax-and-rebate. Everyone gets taxed, and people who purchase health insurance get a rebate for the value of the tax. What is the outcome of this policy? The answer: people who purchase health insurance have a lower tax liability than people who don’t purchase health insurance.
Let’s consider the refundable child tax credit. Everyone who has a dependent child gets a rebate for each child they have. What is the outcome of this policy? The answer: people who have kids have a lower tax liability than people who don’t, and people who have more kids have a lower tax liability than people who have fewer kids.
Based on these outcomes, can you say with a straight face that the individual mandate is unconstitutional while the tax-and-rebate plan and the refundable child tax credit are constitutional? Can you say that ANY of the many deductions, credits, and exemptions present in the tax code are constitutional?
“Based on these outcomes, can you say with a straight face that the individual mandate is unconstitutional while the tax-and-rebate plan and the refundable child tax credit are constitutional? Can you say that ANY of the many deductions, credits, and exemptions present in the tax code are constitutional?”
Those deductions, credits and exemptions were unconstitutional up until the United States ratified the 16th Amendment.
“Let’s presume that you are right and that it is, in fact, unconstitutional to tax people who don’t purchase health insurance. ”
Well there’s the problem: The President and his party are on record as saying this current reform is not a tax. So the courts aren’t allowing them to defend it as an example of the tax power.
Chris, I understand the resentment at having to prop up and support freeloaders of the system. I question your motives for such vehemence against this healthcare bill. I’ve read many of your comments and it appears to me that you oppose everything proposed by the Democrats. You remind me of a friend of mine who always says, “I will NEVER vote for a Democrat.” I was like that, too, until the choice was between McCain/Palin & Obama/Biden. But I’m straying. If I have mischaracterized you, please accept my apology. I have a question for you.
Did you complain when the 2001-2006 Republican congress went crazy spending on No Child Left Behind, Prescription Medicine legislation, tax cuts and two wars, all unfunded?
I did. I honestly believe that there’s something inherently immoral about spending billions on war and foreign aid but having heartburn about providing benefits for our own citizens and residents. But that’s just my opinion, and you know what they say . . .
Reagan Solicitor General Says Health Care Is Constitutional
http://tpmdc.talkingpointsmemo.com/2011/02/reagan-solicitor-general-says-health-care-is-constitutional.php?ref=fpblg
We have real problems, very serious ones and the republicans are playing childish games. I don’t know…
It was constitutional before it wasn’t. Gah.
So the current legal argument against the mandate is that it is a violation of the Commerce Clause and infringes on States rights. The Gov’t cannot regulate inactivity (not purchasing health insurance). If there is no activity, it’s not commerce. I am assuming that proponents of this argument would concede that individual states could enact such a mandate due to a states rights position (although I suspect that Conservatives would find other arguments as to why the States cannot).
My difficulty with the argument is that there is activity anytime someone needs medical care. We have a societal policy that says everyone gets treated in an emergency (to varying degrees), even if they have no ability to pay. Those costs end up being paid for by us, the taxpayer at either the Federal or State level. If you are not required to have insurance, then the taxpayers are unfairly burdened with a mandate – having to pay the medical bills of the uninsured.
I suppose we could change the policy and only treat those with the ability to pay, but if someone has an accident and is unconscious or unable to prove ability to pay – how would we know? What if you are a Conservative Republican who is having a heart attack, do you want the EMT’s who arrive on site not immediately treat you or transport you until you have either provided your insurance information or posted a cash bond? Should they wait until you have regained consciousness so they can charge your credit card for the expense of the emergency treatment?
The Media Consortium » Weekly Pulse: New Anti-Choice Bill Suggests More #DearJohn Letters Needed // Feb 9, 2011 at 11:26 am
[...] medicine: Indeed the individual mandate has its genesis on the right. Ezra Klein interviews ‘Father of the Mandate’ Republican Mark Pauly: “We did it because we were concerned about the specter of single-payer [...]