Check It Out for Tuesday, May 12th
James K. Galbreath writes at Mother Jones that Social Security can help rescue this economy.
"...the elderly do have a backstop: Social Security and Medicare. Thanks to these two programs (and to Medicaid, which covers long-term care at the end of life for many people), no matter how badly things go in the private sector, most of the aged will not become destitute. As things stood before the crisis, 22 percent of the elderly relied solely on Social Security, and while their living standard was very modest, most were still above the poverty line. For the most part we will not return to the days when the corpses of old paupers were collected from the city streets.
"But imagine where we'd be if Congress had accepted George W. Bush's privatization plan. The part of Social Security siphoned off to private accounts would have suffered the market's losses, and recipients would be forced to live off a basic benefit substantially lower than Social Security presently is. At the lower end, Social Security is already not much. (The 2009 median is only $13,950 a year.) Cut it back enough and life expectancies could start to fall.
"The caterwaulers' argument is based on something called "intergenerational accounting": comparing Social Security and Medicare's projected outlays to payroll-tax (a.k.a. fica ) revenues over very long periods. The resulting "shortfalls," amounting to tens of trillions of dollars, are scary looking and headline grabbing. They lure the credulous into imagining that the country is struggling under an appalling burden, and that as a result the government is certain to do very bad things, like raise interest rates, or put us under the control of the communists in Beijing. As for raising interest rates or going bankrupt: The market has the same information as Peterson and Walker. You can check the long-term rate on Treasury bonds, if you're worried—for what it's worth, the financial markets plainly are not.
"Talk about the supposed need to cut back on Social Security and Medicare also gets in the way of the discussion we should be having on how to use these programs to get us out of the hole we're in. Each could be a powerful and useful weapon against the crisis. To wit:
- A permanent increase in Social Security benefits would help offset the losses that the elderly population is suffering on its housing, equity investments, and cash holdings. A 30 percent increase in benefits would not repair individual losses, but it would help keep the elderly, as a group, out of poverty, and relieve severe difficulties in many specific cases. As a bonus, there's a stimulative effect: Middle-aged folks won't need to put their diminished resources toward caring for their parents, freeing them to make other investments.
- A one-year, renewable payroll-tax holiday would greatly ease the financial strain on America's working families, giving them roughly an 8.3 percent pay increase and their employers a comparable reduction in the cost of keeping them on the job. Many mortgages would be paid, and many cars purchased, that would otherwise default or go unsold.
- A reduction in the age of eligibility for Medicare to (say) 55 would be a powerful response to the industrial crisis, permitting many older workers who would like to retire but cannot afford to lose health insurance to do so. It would also relieve private industry of part of its health care burden, while not abolishing employer-based insurance or infringing on existing health care benefits of the prime-age workforce.
"These three measures are among the most promising tools policymakers have right now. Congress should be prepared to use them if and when it becomes clear that the present policies are insufficient.
"Social Security and Medicare should be treated as the bonded obligations of the government—like net interest—thus making explicit what is obvious, which is that these programs cannot go "bankrupt" any more than the government itself can. And, lest anyone forget, in more than two centuries of continuous operations, and despite crises far worse than this one, the government has never gone bankrupt."
Ben Case at IPS News writes about David Bacon's book new investigative book 'Illegal People: How Globalisation Creates Migration and Criminalises Immigrants', which details the history of immigrant labour and the latest round of attacks by anti-immigration forces.
"Smith farm tried to prevent him from seeing a doctor, but when he did, he discovered the damage was caused from working in fields doused in dangerous pesticides with no gloves.
"Guerrero called Legal Aid, a programme providing free legal services to low-income people. As a result, he was sent back to Mexico and blacklisted, his name put on an official "record of ineligibility" for work visas in 2003. Legal Aid responded anyway, issuing a pink "know your rights" booklet to guest workers in North Carolina farms.
"The following year, Juan Villareal, also on a guest visa from Mexico, was one of 200 workers taken to a barn outside the North Carolina Growers Association office, where the workers were told to throw their "know your rights" booklets in a trash can. They were then made to sign contracts, written in a language they could not understand, under threats of arrest and uncompensated tickets back to Mexico if they did not comply.
"Theirs and other stories are part of David Bacon's new investigative book 'Illegal People: How Globalisation Creates Migration and Criminalises Immigrants', which details the history of immigrant labour and the latest round of attacks by anti-immigration forces.
"There are currently 300,000 documented guest workers and more than 11 million undocumented workers in the United States. Making up about 5 percent of the country's workforce, more than half of undocumented migrants are from indigenous regions of Mexico like Chiapas and Oaxaca.
"....Bacon delves into the Smithfield Foods pork factories in North Carolina and its subsidiaries in Veracruz, Mexico, where the recent outbreak of H1N1 flu is believed to have started.
"Smithfield ran small pig farms in the area out of business, and imported those workers from their homes in Veracruz to work in its plant in North Carolina. Smithfield located its pig farm subsidiary in Veracruz in 1994, the year after NAFTA was signed, and its poor sanitation practices such as disposing of pig corpses and waste in the open, near the public water supply, is very plausibly related to the H1N1 outbreak, critics say.
" 'You certainly can’t compete as an old-fashioned pig farmer any longer [in] that town. Then you have this company making people live around pounds and pounds of pig excrement with no sewage.' Bacon explained. 'All of these things are connected, and it's easy to see the connections once you start looking for them.'
"Another key aspect of the book is Bacon’s connection of migrant workers' plight to the labour movement as a whole. He describes the often difficult relationship between established labour unions in the U.S. and new arrivals, as well as the tenacious attempts by both documented and undocumented immigrants to organise.
"Bacon elaborated to IPS, 'Our experience shows that when a company came down on immigrants they were saying to the white and black workers that their situations would improve if they let it happen. Experience also shows it was only when those workers were able to cross the lines of race and nationality to fight for the right of everyone to work that there were results.' "
Luke Mitchell at Harper's writes about why America won't get the health care system it needs.
"The argument for single payer is straightforward. When everybody is in, you don’t have to spend a lot of time and money deciding who to keep out. You also don’t have to worry about what to do with the people you’ve kept out when they get sick anyway. (Uninsured sick people cost insurers nothing, but since they often end up seeking expensive emergency-room treatment, they cost taxpayers a lot.) If you want to quit your job and work someplace else, you can do so without fear of losing your health insurance, which means that labor is more mobile. And employers don’t have to carry the burden of benefits, which means that capital is more mobile. If you get sick, you don’t have to worry about losing your coverage or your house. Your insurance is paid for through taxes. And your taxes don’t go up just because you have a preexisting condition; under single payer, there is no such thing as a “preexisting condition.” Moreover, your provider—the single payer—has an incentive to keep you healthy your entire life, rather than just getting you to age sixty-five and then dumping you into Medicare. And if the experience of most other countries is any indication, the whole thing would cost a lot less than our current bloated mess of a system.
"The benefits of single payer were at one time if not a matter of consensus then at least a topic considered worthy of discussion, at least among Democrats. 'I happen to be a proponent of a single-payer health-care program,' Barack Obama said in 2003. 'As all of us know, we may not get there immediately. Because first we have to take back the White House, we have to take back the Senate, we have to take back the House.' And yet as Democrats began to take all of those things back, Obama began to reconsider. In 2007, he recast the debate in terms that were more reflective than prescriptive. 'If you’re starting from scratch,' he told The New Yorker, 'then a single-payer system would probably make sense. But we’ve got all these legacy systems in place, and managing the transition, as well as adjusting the culture to a different system, would be difficult to pull off.' And now that Democrats have the White House, the Senate, and the House, it is clear that a single- payer program is not a part of their agenda.
"Something is going to happen, though. That much is certain. And it probably will be similar to the approach set forth in a white paper this November by Montana Senator Max Baucus, who is chairman of the Senate Committee on Finance. The plan borrows ideas from (among many others) Hillary Clinton, incoming Secretary of Health and Human Services Tom Daschle, and Obama himself. The details are vague, but the outline is clear. It achieves universal coverage by requiring Americans who do not already receive health benefits to purchase insurance from a private company. (Obama has proposed that such a mandate should cover only children, but Daschle—whom Obama has charged with overseeing the reform process—has called for the mandate to be universal.) In turn, most employers would be required either to provide benefits to all of their employees or to pay into a fund that would be used to subsidize the purchase of private insurance by those who could not afford to pay for it themselves. This approach is designed not only to assuage the concerns of the many Americans who do not want to change their present arrangements but also to keep America’s health-insurance plans—which employ half a million people, and which saw a major decline in profits in 2008—in business.
"It would not be unfair to describe the Baucus approach as “market-oriented.” This may, in fact, be why it has emerged as an acceptable locus of reform. In Washington, there is little that is considered wiser or more bipartisan than a preference for markets. And that preference can even be expressed in terms that are surprisingly far from the standard Cato Institute talking points. Jill Quadagno and Brandon McKelvey, researchers at Florida State University, for instance, report a widely held vision of so-called consumer-directed health care, which would inject an almost Naderite devotion to consumer awareness into discussions about health care. The goal, they write, “is to transform patients into informed consumers by making medical care into a commodity that is purchased in the same way as other market goods.”
"This preference for markets is common, but it is not wise. The health-care system is not at all like other markets, because health, for obvious reasons, is not at all like other goods. (The demand for not dying, to give just one example, is pretty much unlimited.) And in America, market-based solutions very often end up involving the government anyway, as has been made evident most recently in the aftermath of the failed deregulation of Wall Street. Thus far, as Quadagno and McKelvey note, the consumer-directed health-care vision actually has “been implemented through obscure changes in tax law, technocratic provisions added to bills designed for other purposes, experiments with Medicaid ‘waivers’ and a new option, Medicare Advantage,” which introduces supplementary private insurance into the Medicare system. Which is to say that no matter what happens this year, the dead hand of government will continue to direct the flow of health-care dollars in the United States.
"Nonetheless, Democrats clearly do not want to discuss the role of government in terms that could be understood as unfriendly to the market. “We all have to keep an open mind on all this stuff, figure out how to get to yes. Everything is on the table,” Baucus had cautioned. “The only thing that’s not on the table is a single-payer system. That’s going nowhere in this country.”
"No one doubts that fixing the health-care system is going to require someone to make difficult choices. In 2006, Americans spent $2.1 trillion on health care—at $7,026 per person, more than any other nation—and yet we lag far behind other nations in such measures as infant mortality, life expectancy, and early detection of life-threatening illnesses....
"The word for making such choices, so often unsaid in American politics, is “rationing.” All health-care systems, no matter how wealthy, require some form of it, because advances in technology always outpace the ability to pay for them. But there are (at least) two ways to decide who gets what in a health-care system. One of them is to let the market sort it out: those with the most money get the most care. The other is through triage: society seeks to determine, within a given budget, the most effective treatment for the greatest number of people. The difference between these two approaches is significant.
"In the United States today, we can use our belief in numbers, which borders on the religious, to rationalize any amount of inequity. We can tell ourselves that we can’t have a system that guarantees health care to every American because such a system would be “inefficient.” We can tell ourselves that we must accept a world in which children suffering from post-traumatic stress don’t get any help because the numbers don’t support it. We can tell ourselves that we must trust our health to insurance companies, that markets are wiser than doctors, that we can afford every technology. We tell ourselves stories and we rationalize our prejudices, and, unless we are willing to more specifically address the “social determinants of health,”....we will continue to drift toward a change far more substantive than anything currently under consideration in Congress, a change suited to the few who care to exert their will. It may be a revolutionary system of corporate medical control, or a catastrophic financial collapse resulting from hubristic overtreatment, or a medical crisis stemming from some seemingly minor flaw in the heuristics of the integrated delivery network, or just a further increase in the massive inequities that already disgrace our current system. Whatever that change is, though, it will in the end be defined by the passivity of a people that has sacrificed its own, dem ocratic power of large numbers on the altar of strange and unstated beliefs."
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