Monday, May 13, 2019

Peter Morici — Opinion: Bernie Sanders's Medicare for all is a fool's journey

The looming debate. The American public overwhelming wants changes. Now the debate begins in earnest (again) over how to structure this reform. While this article takes a negative angle, it lays out some of the key issues that will be prominent in the ensuing debate.

What MMT has to contribute is understanding of how real resources economically and competing interests politically are the actual issue, whereas the financial issue of affordability is a non-issue for a government that funds itself through currency issuance.

The real resource issue is, well, real. There are only so many existing medical resources and vastly increasing the number drawing on them would result in some bottlenecks. However, this issue can be addressed in a fairly short time — five to ten years — by public investment in expansion. Some of this could required repurposing existing resources now being used on lower priority tasks.

The political issue is knotty is that all economic choices involve tradeoffs owing to opportunity cost. This comes down to winners and losers depending on the constituencies favored by a policy. Making everyone better off and no one less well off is often not possible, given the exigencies of distribution, including availability of real resources and how they are regulated.

In addition, universal health coverage and tuition-free education, and a universal guarantee of a job offers would likely require changing tax policy unless other spending, like military deemed unnecessary or wasteful would be reduced.

Anyway, the debate is now engaged and some of the issues are on the table explicitly.

As it tutns out, Stephanie Kelton anticipated this debate on a paper with Alla Semenova, Health Care Reform, Universal Coverage and Financial “Basics” A Functional Finance Perspective (August 2008).

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