If you're interested in health care reform, the appointment of Peter Orszag to be director of the Office of Management and Budget is second only in importance to the the elevation of Tom Daschle to health czar and HHS secretary. OMB is a strange place. It's incredibly important, but also somewhat amorphous. It's a cabinet level agency that offers policy recommendations to the president, scores programs, builds the yearly budget. It is how the executive branch imposes empirical rigor on its agencies, and coheres their work into a single budget. In that way, it is the connective tissue of the federal bureaucracy. And the director sits atop all that, sets many of the agency's priorities, and is, generally, one of the president's top policy advisers.
Orszag will be coming from the Congressional Budget Office, OMB's legislative cousin. There, he's shown an almost single-minded focus on health care reform. He's added dozens of health care analysts to the staff, reconstructed the health policy division's management structure, and is readying to release two major books on health policy options and CBO's health care scoring models that will be extremely central in how Congress looks at building a health care bill. Amidst all that, he's toured the country giving a slide show about the problems of the health care system, the overwhelming danger it poses to our fiscal condition, the incredible inefficiencies that beset the delivery, and the research that suggests reform could not only save money but also improve care. He's also acted as a powerful and credible counterweight to those who counsel incrementalism, or delay, on health reform. Indeed, when it became common to suggest that the bank bailout should displace ambitious agenda items like health care reform, Orszag took to his blog -- yes, he has a blog, did I mention that? -- to write:
Many observers have noted that addressing the problems in financial markets and the risks to the economy may displace health care reform on the policy agenda...Although it may not seem immediately relevant given our current difficulties, it will be crucial to address the nation’s looming fiscal gap — which is driven primarily by rising health care costs — as the economy eventually recovers from this current downturn. Indeed, our ability to address our current economic difficulties (through both financial market interventions and potential additional fiscal stimulus) would be severely impaired if investors were not so willing to invest substantial sums in Treasury securities without charging much higher interest rates. That willingness reflects the (currently accurate) view among investors that Treasury securities are extremely safe investments.In other words, one of Obama's top economic advisers will be an economist who has clearly stated that he thinks health care reform central to our fiscal future, who has said that he considers delay or denial a dangerous impulse, and who has proven himself willing to leverage his position and agency to argue that position. That's important, as it assures that there will be voices around Obama arguing that health care is more than simply another item on the lengthy liberal wish list. Orszag also has a smart and innovative take on how to approach health reform, but for more on that, you'll have to wait for the next issue of The Prospect...If we fail to put the nation on a sounder fiscal course over the next few decades, though, we will ultimately reach a point where investors would lose confidence and no longer be as willing to purchase Treasury debt at anything but exorbitant interest rates. If that were to occur, we would lack the kind of maneuvering room that we currently enjoy to address problems in the financial markets and the economy. So if you think the current economic crisis is serious, and it is, imagine what it would be like if we didn’t have the ability to undertake aggressive and innovative policy interventions because creditors were effectively unwilling to lend substantial additional sums to the Federal government…
