The Week

(Roman Genn)


Al Haig was a combat veteran (Korea and Vietnam), four-star general, supreme commander of NATO, and secretary of state. Yet so much about him was sharp-edged and small. He rose by marrying a general’s daughter, and by serving the right civilians as assistant: Robert McNamara, then Henry Kissinger. His two runs for president (the National Review Bulletin said you needed “bionic eyes” to spot his first, in the 1980 cycle) failed; so he decided that politics was “sleaze.” When Ronald Reagan was shot, he tried to reassure the nation by declaring (wrongly, and with obvious distress) that he was in charge at the White House. Yet, during one of the low points of the presidency, he served as Richard Nixon’s chief of staff, replacing the soon-to-be indicted H. R. Haldeman. No one ever nailed down all the details, but Haig helped persuade Nixon to go, and encouraged Gerald Ford, his successor, to pardon him. Right on both counts. Dead at 85. R.I.P.

Catastrophic Mistake

An exchange at the health-care summit got to the root of the matter. Sen. Lamar Alexander (R., Tenn.) said that the Democrats’ legislation would increase premiums for insurance policies bought by individuals rather than businesses. President Obama first insisted otherwise, then conceded the point while attributing the rise to the greater comprehensiveness of the insurance policies. This greater comprehensiveness would be mandated. During the summit, Obama insisted that bare-bones insurance coverage — insurance that protected only against financial catastrophe — was not insurance at all.

The truth is closer to the reverse. As Nobel Prize–winning economist Kenneth Arrow pointed out nearly five decades ago, using insurance to pay for routine and predictable expenses makes no sense. The market can provide catastrophic insurance. It cannot provide comprehensive insurance. If the government insists on comprehensive insurance it will have to interfere in markets again and again. This is why liberals are dead-set against letting people buy insurance from out of state. If healthy people can evade their states’ mandates that insurance provide comprehensive coverage by buying insurance in less regulated states, they will raise the price of that comprehensive coverage and thus make it unsustainable.

Ultimately, to make this system work, people have to be forced not to buy catastrophic insurance or forgo insurance altogether: They must be forced to buy comprehensive policies. Those who can’t afford them must be subsidized. Such policies come with built-in incentives for overconsumption, so eventually government experts must swoop in to ration care. The ineluctable logic of comprehensive coverage is why Obamacare so closely resembles Clintoncare and why its proponents are unwilling to make meaningful compromises. Some piecemeal health-care reforms may work; but reforms that attempt to block the market from evolving in its natural direction have to be systematic. All the exits must be locked.

The liberal vision of health-care reform cannot be attained without new taxes, without complicated and ambitious legislation, without the threat of government rationing, or without disrupting people’s existing insurance arrangements. These are some of the reasons for Obamacare’s unpopularity. The Democrats have decided to respond to this unpopularity not by rethinking their health-care policies but by muscling them through. They believe history will applaud them. (Candy and flowers, perhaps.)

March 22, 2010    |     Volume LXII, No. 5

  • The political difference between Reagan and Obama is that the former gave the public what it wanted.
  • For employers who want to test job applicants, it’s damned if you do and damned if you don’t.
  • In Montana, medical-marijuana regulation threatens to shut down the most legitimate tier of operators.
  • A Cuban prisoner of conscience and an extreme method.
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