David Brooks is pushing the line that President Obama is a hopeless big spender desperately seeking to cover his excesses with vague promises of health care savings in the distant future. Most of his story is flat out wrong. First, the vast majority of the increase in the projected deficit for 2009 came from a weaker than projected economy increased bailout costs for the boys at Fannie, Freddie, AIG and elsewhere. This was not the result of big-spending liberals. It was the result of incompetent rich bankers. The larger point, that savings on health care costs are only vague hopes, ignores what we already know. Every other rich country in the world manages to provide comparable health care to its population at a cost that averages less than half as much as in the United States. (In fact, if Brooks and the rest of the elite were not such ardent protectionists, we could solve much of our health care cost problem with freer trade in the sector.) But we don't even have to go to other countries. There are actually huge cost differences within the United States that are not reflected in differences in outcomes. If we could more widely adopt the practices of low cost states/regions, then savings of 20-30 percent are quite plausible. In short, President Obama's health saving targets are very realistic, although he will have to fight some very powerful industry and doctor lobbies to have them realized.
--Dean Baker
