In the Politico today, Jim Vandehei and Mike Allen offer something of a reality check on the next president's spending priorities. In particular, they say, "How can you expand health care coverage when the country is broke? The federal debt is now expected to top $11 trillion by 2010."If you're worried about the federal debt -- particularly the long-term federal debt -- there is literally no way you can afford not to reform health care. The following graph charts the drivers of federal spending over the next couple of decades. Look what leads the way:
Yep. Medicare and Medicaid. Now, because the government releases a lot of graphs like this one, a lot of folks end up believing that the problem is Medicare and Medicaid. But it's not. It's generalized health care spending, and it's as much a burden on the private sector as the public treasury. The next graph tracks the next few decades in GDP per capita, then in GDP per capita after taxes (which is to say, including cost increases in Medicare and Medicaid), then, on the yellow line, GDP per capita after taxes and after private health care spending. And what you see is, to a wonk's mind, quite scary: Real income actually goes down. The country becomes, effectively, poorer.
If what you're worried about is the future fiscal condition of the country, the bailout hardly even registers. Indeed, in comparison to health care, most everything else is secondary. And the longer we wait to fix health care and bring our finances into equilibrium, the more drastic the reform will have to be, and the more painful it will likely prove. The worsening fiscal condition of the country makes health reform more, not less, important.
Yep. Medicare and Medicaid. Now, because the government releases a lot of graphs like this one, a lot of folks end up believing that the problem is Medicare and Medicaid. But it's not. It's generalized health care spending, and it's as much a burden on the private sector as the public treasury. The next graph tracks the next few decades in GDP per capita, then in GDP per capita after taxes (which is to say, including cost increases in Medicare and Medicaid), then, on the yellow line, GDP per capita after taxes and after private health care spending. And what you see is, to a wonk's mind, quite scary: Real income actually goes down. The country becomes, effectively, poorer.If what you're worried about is the future fiscal condition of the country, the bailout hardly even registers. Indeed, in comparison to health care, most everything else is secondary. And the longer we wait to fix health care and bring our finances into equilibrium, the more drastic the reform will have to be, and the more painful it will likely prove. The worsening fiscal condition of the country makes health reform more, not less, important. 
