MIT’s Jonathan Gruber revealed that Obamacare was a fraud. The Heritage Foundation’s Steve Moore argues that it was even worse than that: the first step in a strategy to drive American healthcare towards a centrally planned, single-payer regime—and away from the positive health outcomes that only markets and innovation can deliver.
On the occasion of the release of his new Encounter Broadside, Moore vs. Krugman, I had the chance to speak with the former Wall Street Journal editorial board member about his debate with Paul Krugman and on their exchange on the the American healthcare system in particular.
Moore’s unvarnished pessimism of the current healthcare regime is reflected in the exchange below (edited for clarity):
Ben Weingarten: Paul Krugman says in the book and I quote here, “the biggest reason healthcare costs rise is that medical innovation keeps delivering new things we can do.” That strikes me as the most economically illiterate thing that you can argue because when you produce more things and you innovate, the prices generally go down. So why haven’t we seen that in healthcare, and why do you think that healthcare costs continue to rise?
The endgame of Obamacare has always been to end up with a single-payer system
Steve Moore: Well Ben you are right that innovation actually leads to lower healthcare costs and it leads to much better health outcomes. And you look at things like new drugs or vaccines for strokes or heart disease or cancer treatments, and those treatments tend to be much less costly than surgery. So you are right, innovation is what we want more than anything in healthcare because it drives down costs number one—but more importantly it leads to better health, and that’s what we’re after with healthcare right, is health. Sometimes we lose sight of that.
There is a big difference between insuring someone for healthcare and making sure that they are getting good medical care. What Obama did under Obamacare was he just dramatically raised the number of people who are on Medicaid. Well guess what? It turns out Medicaid is not a very good way to improve health. A lot of experiments have shown that people on Medicaid don’t have any better health outcomes than people who don’t have any health insurance at all. So what we want to make sure of is that we are improving people’s health, and the way to do that is through innovation and through competition.
There is a big difference between insuring someone for healthcare and making sure that they are getting good medical care.
We pay for healthcare in such a dysfunctional way in America. It should be based on true insurance where upfront costs for things like going in for a check-up or a dental exam or something like that, those are paid for by people just like when you pay your grocery bill. But if you have a major expense—major surgery or something of that nature—then you have insurance to cover for that. We don’t have that kind of system and that is why you don’t have enough competition.
Incidentally, I think the endgame of Obamacare has always been to end up with a single-payer system—a socialized healthcare system—and I think Obama was strategic. He felt like “Well, Obamacare will just be the middle step that will get us to socialized medicine,” when what we really need in healthcare is much more competition and consumer-driven financial decisions.
Ben Weingarten: And unfortunately of course it is going to be the market that gets blamed for the lack of health insurance options, and the government will become the monopolist that can save us. That is the irony of it.
Steve Moore: Yeah, well that was by design. We all knew that Obamacare was designed to fail. And this is one of the reasons why I don’t have any sympathy for the health insurance companies because, as you know Ben, the biggest cheerleaders for Obamacare were the insurance companies. They said “Oh, this is wonderful. Obamacare is going to provide us with all these new customers.” What they didn’t realize is, you don’t want to get in bed with the devil because they are going to destroy you, and then as prices go up they’re going to say “Oh these greedy insurance companies we have to get rid of them.”
If we stay on the course we are re on, we have two choices: One is we have to throw out the system and really move towards free market healthcare, or number two we are going to have price controls and we are going to have a single-payer system, one size fits all. And not only is that going to be expensive, but it’s also going to be very deleterious to the people’s health and to finding the cures for cancer and multiple sclerosis and AIDs and Alzheimer’s and all of those killer diseases that cause human suffering.
We all knew that Obamacare was designed to fail.
During the wide-ranging interview, which you can listen to in full below, we had the chance to discuss several other topics including:
- Why capitalism is superior to socialism
- Moore’s critique of the so-called ‘Obama recovery’
- How to fix American monetary policy
- The state of the American labor picture
- Moore’s views on tax reform
- Moore’s economic plan for Donald Trump on taxes, entitlements and monetary policy
…and a great deal more.
