David Gratzer

Credit where credit is due: the latest White House argument for health reform is compelling. The administration has figured out how to sell a massive expansion of government as “fiscally conservative.” On Thursday, the CBO released estimates for the President’s bill, projecting an overall cost savings. The White House now trumpets that the health-reform bill will lead to the biggest legislated reduction of the deficit since the first term of the Clinton Presidency.

“You have to spend money to save money” is a popular expression. No doubt, that’s what the White House is hoping Americans will think when they read the numbers. Throughout this process, the CBO has projected savings: Earlier this month, for example, the CBO revised its estimate of the 2009 Senate health reform bill, projecting $118 billion in estimated savings over the next ten years (a reduction from the previous estimate of $130 billion). Thursday’s estimate – $138 billion – suggests slightly more deficit reduction.

Sean Hannity FREE

The trouble is, taxpayers will be spending $875 billion in the hope of saving $118 billion in the Senate bill, or spending $940 billion in the hope of saving $138 billion in the reconciliation bill. That’s an 8:1 ratio for the Senate bill, and 7:1 (rounded) for the reconciliation bill – assuming, of course, that government programs stay on budget.

That means that to “save” a dollar in Washington, you have to spend seven dollars to get it. The White House allies are enthusiastic. “That’s a pretty good deal,” Ezra Klein wrote in his Washington Post blog. Paul Krugman agrees, describing it in his New York Times blog as a “bargain.”

The refrain that this is a “deal” or a “bargain” strikes at the core of what ObamaCare really is. Because, of course, there’s no deal and no bargain. ObamaCare’s spending shifts the poorest patients from expensive emergency-room care into a proper regiment of checkups and preventative health – which may produce savings per treatment, even if it costs taxpayers more in the long term. But beyond that, little about ObamaCare’s spending has anything to do with saving.

If deficit reduction was really the goal of health reform, the President could simply table a bill with all of his proposed taxes and Medicare cuts. Implement those measures, and you could cut trillions of dollars from the deficit over the same ten years, instead of mere billions.


David Gratzer

Dr. David Gratzer, a physician, is a senior fellow at the Manhattan Institute. David Gratzer's most recent book is Why Obama's Government Takeover of Health Care Will Be a Disaster (Encounter Books, 2009).