How to Transcend Obamacare
Conservatives have an opportunity to liberate health care for everyone.


Avik Roy

For four and a half years, conservatives have been adamant in their desire to repeal Obamacare. The case for repeal goes something like this:

The Affordable Care Act is the largest expansion of the entitlement state since the 1960s. It represents a tipping point — perhaps a point of no return — in the transformation of America from a free, constitutional republic into a European-style social democracy. The law represents an unprecedented intrusion of the government into our lives, far worse than anything that has come before. Furthermore, because Obamacare is our newest entitlement, it’s less entrenched than older programs, and therefore represents our best opportunity to roll back Big Government.

It’s an understandable — and widely held — view. And it’s an accurate one, in important ways. But there are a couple of things it gets wrong about our current situation, and that’s a good thing.

It turns out that repealing Obamacare is not our only hope for reversing the triumph of the entitlement state. Indeed, there may be an even better one.

The government takeover of health care took place in 1965, not 2010.

One thing you often hear conservatives say about Obamacare is that it represents “the government takeover of the U.S. health-care system.” This is not precisely true. The actual government takeover of the U.S. health-care system took place in 1965, when Lyndon Johnson signed into law the bills enacting Medicare and Medicaid: the “Great Society.”

Medicare and Medicaid were — and are — single-payer, government-run health-insurance programs for the elderly and the poor, respectively. Today, nearly a third of the U.S. population is on single-payer health care, thanks to Medicare and Medicaid. These programs have profoundly distorted the U.S. health-care system, in ways that make health care more expensive for everyone else. Well before anyone had heard of Barack Obama, Medicare and Medicaid had placed America on a path to bankruptcy.

Many conservatives fear that Obamacare is a “Trojan horse” for single-payer health care in the United States. But in 2013 — before Obamacare went online — 93 million Americans were on either Medicaid or Medicare. Another 6 million got coverage through the Veterans Health Administration, the most socialized health-care system in the U.S. That means that nearly 100 million Americans were on single-payer health care, or its facsimile, before Obamacare went into effect.

Obamacare builds on the LBJ legacy, to be sure. The law expands the scale and scope of the Medicaid program. Overall, Obamacare increases federal health-care spending by about 15 percent. But in 2012, U.S. government entities were already spending $4,160 on health care for every man, woman, and child in the country. That’s more than all but two other countries in the entire world.

Many European economies are freer than America’s.

When it comes to government health-care spending, then, the U.S. is actually worse off than most of the European countries at which we wrinkle our noses. Indeed, when it comes to economic freedom, the U.S. has fallen behind many of its European competitors.

In the 2014 edition of the Heritage Foundation’s Index of Economic Freedom, the U.S. ranked 12th, behind Hong Kong, Singapore, Australia, Switzerland, New Zealand, Canada, Chile, Mauritius, Ireland, Denmark, and Estonia. One of the things that’s remarkable about that list is that every single country on it save Mauritius has some form of universal health care.


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