David Brooks: *still* an alien

Brooks is back, and so is his misunderstanding (unintentional or otherwise) of American politics. In today’s column, David Brooks’ main argument is that Democrats are too emotional on the issue of health care reform and are therefore insufficiently committed to deficit and debt reduction. Here’s Brooks:

For the Democrats, expanding health care coverage is an emotional hot spot. … There is something morally impressive in the Democrats’ passion on this issue. At the same time, it’s interesting to compare it to their behavior on other issues in which they have no emotional investment.

Now I’d like to go point-by-point through the rest of Brooks’ argument and evaluate his claims. Quotations from the column will be indented block quotes. My responses will be normal text. It’s longer than my usual post, but Brooks’ argument is just that bad.

For example, Democrats say the right thing when it comes to helping small businesses create jobs, but there’s no passion there. For the past year, small business owners have been screaming that they can’t hire people because they don’t know what the rules will be on health care, finance or energy.

Well, if uncertainty over health, finance, and energy is slowing down job creation, then maybe ending the current uncertainty by passing legislation might be a good idea. That’s why Democrats are trying everything they can think of to turn their bills into law. That seems obvious for health care. On energy, Democrats have made a fairly large effort, with the House passing Waxman-Markey last year despite loud protests from vulnerable Blue Dogs and others that such contentious votes were inappropriate. Obama would like nothing more than Senate action on Waxman-Markey, and not having it really set him up for a fail he would have loved to avoid in Copenhagen. Several Senators are working hard to get movement on energy/climate change, but once again the problem is institutional design (an intransigent minority with the power to kill just about anything the majority proposes, a minority whose interest is in seeing the majority’s program fail, and a minority whose ideology is tilting ever farther towards the ostrich approach on climate change and energy issues). On financial regulation, again, Sen. Dodd (D-CT) is working overtime trying to get a bill that can get past the Republican filibuster. But with Republicans enjoying their newfound campaign contribution windfall from Wall Street, he’s getting little traction. The stronger early drafts continue to be whittled down to appease do-nothings necessary to get to 60. Maybe David Brooks doesn’t know all these facts, but if he did know them, then he really ought to be arguing that “Republicans show remarkably little passion on small business issues, and that the Senate’s institutional design is ill-equipped to address them.”

Small business owners have been screaming about the health care bill that forces them to offer coverage or pay a $2,000-per-employee fine but doesn’t substantially control rising costs. Democrats hear their concerns, but push ahead because getting a health care bill is more important.

First, this doesn’t get said enough: 96% of small businesses have 50 or fewer employees, and those same small businesses with 50 or fewer employees are exempt from the fines Brooks is talking about. Only those businesses on the very large end of ‘small’ and up are subject to the fine. So perhaps the worst that can be said about Democrats on this count is that “Democrats hear the concerns of 4% or 5% of the very biggest small business owners, but push ahead because getting a health care bill to cover 30 million Americans is more important”. On the issue of cost control, I’m with these small business owners Brooks invokes: if I were designing a health care overhaul in a vacuum, I’d definitely make sure to control costs more than the current bill. But it seems to me that the current bill has lots of cost control provisions – more than have ever gotten this far in Congress before in the history of our country – and that the reason the bill doesn’t go farther is because Democrats had to ax or diminish powerful cost controlling provisions (the public option, the Medicare commission, Medicare buy-in) and couldn’t even seriously consider serious price commissions (Maryland style) or single-payer. They had to do that in order to overcome the filibuster and get to 60 votes, again because of Republican obstructionism. So to Brooks and his deified 5% of ‘small’ business owners, I say it seems like Democrats in general have heard them just fine, agree with them, and have done their best against an obstinate minority and bad institutional design to put their concerns into law.

Then there is the larger issue of exploding federal deficits. A few Democrats are genuinely passionate about this, President Obama among them. He has fought tenaciously to preserve a commission that might restrain Medicare spending. But 90 percent of the people in Congress have no emotional investment in this issue.

Brooks is probably right that 90% of the people in Congress have no emotional investment in curbing deficits. I’d even put the number a little higher. He goes on to criticize the Democrats and Obama for being insufficiently invested in the issue, even if he concedes that Obama himself is genuinely passionate on the issue. In general, it’s great for people to highlight the deficit dovishness of nearly the entire political spectrum, so props to Brooks. But I might ask, are there any Republicans Brooks would point to as being ‘genuinely passionate’ on deficit reduction, as he singled out Obama? If so, are any of them even close to the stature of party leader? This question really ought to be asked not in light of rhetoric, but actual political behavior, particularly in light of the Bush tax cuts, episodes 1 and 2, the Republicans’ completely unfunded Medicare Part D legislation, the death of the debt commission in the Senate, Sen. McCain’s gambit to exempt Medicare from the reconciliation process and thus make it nearly impossible to reform, and political grandstanding on proposed cuts and cost-saving provisions in the Dem bill (death panels, anyone?). If there are Republicans who opposed these budget-busting Republican hijinks, then they probably qualify as “genuinely passionate” on deficit reduction. The case for calling any Republican of import a deficit hawk seems pretty weak. Yet Brooks himself admits that some Democrats, including the head of the party, are genuinely interested in deficit reduction and taking on long-term challenges. So maybe Brooks should spend more time supporting those few who are actually making such efforts rather than making flimsy excuses to support his own preferred political party and attack the only real hawks left on the field.

Next, Brooks gives us a list of supposed boondoggles within the health care bill:

There is the doc fix dodge. The legislation pretends that Congress is about to cut Medicare reimbursements by 21 percent. Everyone knows that will never happen, so over the next decade actual spending will be $300 billion higher than paper projections.

I don’t know how many times this has to be said, but the ‘doc fix doge’ is a dodge built into current law, not the Democrats’ health care reform bills. A brief history: in 1997 a Republican Congress passed and a Democratic President signed into law a Sustainable Growth Rate for Medicare based on that period’s unusually low health care cost increases which was never intended to dramatically cut payment rates. Later on, actual health care inflation returned to historically-normal levels so the SGR would start mandating unintended cuts in Medicare. Since then, multiple congresses over a decade have postponed SGR’s cuts in a bipartisan fashion, instead of permanently fixing the problem. I don’t see why Brooks thinks this is something disingenuous Democrats are doing in the health care bill. It’s something disingenuous that has been built in to our country’s budgeting for 13 years and has been pushed off onto the horizon again and again by both parties, but more often by Republicans. True, Democrats want to permanently fix the Medicare SGR problem, and tried to do so along with health care reform, but when those costs were objected to by Republicans, Democrats jettisoned the fix from the bill and chose to focus only on health care reform, not on also fixing longstanding budget gimmicks. Is the new standard that before you make a new law you fix all gimmicks in existing laws? That said, some Democrats are still interested in permanently fixing the ‘doc fix’. If only there were a right-of-center columnist willing to encourage his own party to cooperate…

There is the long-term care dodge. The bill creates a $72 billion trust fund to pay for a new long-term care program. The sponsors count that money as cost-saving, even though it will eventually be paid back out when the program comes on line.

I don’t know enough to know what Brooks is talking about here. But even assuming the worst, that this is just outright lying by the bill’s backers and that the unfunded $72 billion is a recurring 10 year cost, then that raises the true price of the bill by $7.2 billion per year, which is small potatoes in the federal budget. Is this really once of Brooks’ main criticisms of this bill?

There is the subsidy dodge. Workers making $60,000 and in the health exchanges would receive $4,500 more in subsidies in 2016 than workers making $60,000 and not in the exchanges. There is no way future Congresses will allow that disparity to persist. Soon, everybody will get the subsidy.

Again, I’m not too knowledgeable about this particular issue. But Congress seems perfectly happy with the incredible disparities in current tax law. Why does Brooks think this one will be especially short-lived? Besides, [and again, this is ignorance talking, not actual knowledge] maybe it’s better for new subsidies to favor the exchanges, given that employer-provided insurance is already heavily subsidized under the current tax code, and maybe it’s good policy to encourage people to migrate to the exchanges over time. I’m really not up on this policy area, but my hunch is that David Brooks isn’t, either.

There is the excise tax dodge. The primary cost-control mechanism and long-term revenue source for the program is the tax on high-cost plans. But Democrats aren’t willing to levy this tax for eight years. The fiscal sustainability of the whole bill rests on the naïve hope that a future Congress will have the guts to accept a trillion-dollar tax when the current Congress wouldn’t accept an increase of a few billion.

The only reason the excise tax is still alive even in its delayed form is that the Obama Administration has fought for it tooth and nail in negotiations. Very few people actually like the excise tax: not the Senate, not the House, not most Democrats, not most Republicans. And the way the system is set up, the President can’t dictate terms when Congress is basically united against him.  So instead of saying “Democrats aren’t willing …”, a better way of putting it would be “No one but Obama was willing to fight for this, so props to him and the Democratic leadership that reluctantly went along on the delayed tax”. As for whether the belief that this tax actually gets enacted or not is “naïve”, I guess that depends on how much you know about the institution that is Congress. Once established, programs usually don’t die. Once committed to, policies are hard to end. Besides, budgeting is always about the future. Does Brooks object to any and all budgets that commit us to tax and spending changes in the future? On a larger note, Brooks is a self-styled deficit hawk, and presumably he knows that any deal to reduce deficits is absolutely going to have to rely on future commitments to new taxes and spending cuts. Deficit reduction doesn’t happen overnight, it’s a process. So if/when Brooks’ hoped-for deficit deal comes about, is he going to write a column blasting the deal, saying “It’s naïve to think that this historic compromise is going to last, since some of it happens in the future, and therefore I oppose this deal” ? I don’t think so.

There is the 10-6 dodge. One of the reasons the bill appears deficit-neutral in the first decade is that it begins collecting revenue right away but doesn’t have to pay for most benefits until 2014. That’s 10 years of revenues to pay for 6 years of benefits, something unlikely to happen again unless the country agrees to go without health care for four years every decade.

This is one of only two legitimate points Brooks raises in the article. Delaying implementation while starting some revenue collection immediately was a budget gimmick Democrats used. It’s worth noting that they used this gimmick because of a fear of an arbitrary $1 Trillion 10-year CBO score. You see, we as a people are incapable of handling large numbers. If Democratic leadership had designed a bill with a true 10-year cost of over $1 Trillion, then we would have seen Brooks writing a column about How Really, Really Big a Number $1 Trillion Is. Of course, this has nothing to do with actual policy, either on health care or budgeting. I’d personally prefer that we do everything in 1-year costs and avoid all CBO-scoring-window gimmicks, but this is a time-honored tradition of our poorly-designed Congress. But it’s important to note that Brooks’ criticism, though valid, is more about process than policy.

There is the Social Security dodge. The bill uses $52 billion in higher Social Security taxes to pay for health care expansion. But if Social Security taxes pay for health care, what pays for Social Security?

It seems to me like this is another legitimate criticism. But, again, $5.2 billion a year in budget gimmicks, while a bad thing, is not breaking the bank. If the overall headline cost of the bill was $5.2 billion cheaper every year (perhaps by trimming the subsidies slightly) in order to cancel out the need for this budget gimmick, would Brooks say, “Ok, that seems reasonable. Everybody get on board the Health Care Reform Express!” I doubt it.

There is the pilot program dodge. Admirably, the bill includes pilot programs designed to help find ways to control costs. But it’s not clear that the bill includes mechanisms to actually implement the results. This is exactly what happened to undermine previous pilot program efforts.

So Brooks is (rightly) overjoyed that the bill does more to create cost control pilot programs than jut about ever before. His critique: but what ensures that these pilots grow? Well, Mr. Brooks, if everyone was hunky-dorey with the programs growing, they wouldn’t be pilots in the first place. They’d be full-blown programs. And if you wanted to guarantee that successful pilots are scaled up, you’d need to guarantee the funding. And if you want to guarantee the funding and still be a deficit hawk under PAYGO, which Democrats, or at least Obama, clearly do, then you need to identify revenues to pay for those new pilots. That gets us back into OMG, Big, Big Numbers! territory, which is a place Mr. Brooks and most grandstanding politicians don’t seem to like. A further complicating factor is assuming how many programs would be effective and merit scaling up, and at what cost. How are we supposed to budget for a wide range of possible expenditures? I guess my point of view is that health care reform is going to be an ongoing process, just like any other political issue. We’re going to have to ask future Congresses and future Presidents to identify successful pilots and scale them up. That seems like a fairly ordinary and unfortunately necessary component of our democratic system. What is Mr. Brooks’ suggestion on how Democrats could have avoided this situation, exactly? And is this really a serious reason for opposing the overall bill?

The Democrats have not been completely irresponsible. It’s just that as the health fight has gone on, their passion for coverage has swamped their less visceral commitment to reducing debt. The result is a bill that is fundamentally imbalanced.

This is “fundamentally imbalanced”? CBO, the impartial jury in these matters, scores the bill as reducing the deficit overall, with even stronger gains in deficit reduction in the second and subsequent decades. In response, Brooks lists a handful of small but legitimate criticisms, and a bunch of misinformation and silliness. Is Brooks misunderstanding the political system and/or grasping at straws to justify his precomittment to oppose Obama’s health care reform? Or is he an alien?


1 Response to “David Brooks: *still* an alien”

  1. 1 Aliens: outsourced « Joint Stock Company Trackback on March 16, 2010 at 10:46 pm

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

Subscribe by email, feedburner

Subscribe by e-mail

or subscribe with feedburner

This is a group blog. JSC5 currently writes from the US. JSC7 writes from behind the Great Firewall of China.

wordpress statistics

Categories and tags



%d bloggers like this: