In my last column, I argued that for all the undeniable woes of the Republican Party, the unfurling of Obamacare represents a huge vulnerability for Democrats. The Democratic health reform bill is economically nonsensical and politically unpopular. A recent Rasmussen poll found that 54 percent believe the law will damage the U.S. health care system. Even among Democrats, support for the law is ebbing. In February, a Kaiser Family Foundation poll found that only 57 percent of Democrats (compared with 72 percent in November of 2012) support the law.
The battle over health care reform is not over. Yes, the 2012 election ensured that the law would not be repealed and replaced in 2013. But when the American people are unhappy with a policy, they find a way to alter it. Republicans can tie themselves in knots and consider abandoning their principles on abortion, taxes, immigration or marriage (and perhaps some of those positions require rethinking), but the health care issue is pitched right over home plate.
Nearly every American is intimately concerned with the delivery of health care. Choice and competition can deliver what Americans desire -- a quality product at an affordable price. Before offering reform proposals, Republicans need to be clear that they are not endorsing the status quo ante.
The pre-Obamacare health care system was not a free market for health care at all but a peculiar hybrid with distorting incentives created by bad government policy. Because the government set wages and prices during World War II, employers were not permitted to raise salaries more than a set amount approved by National War Labor Board. Employers resorted to providing fringe benefits, including health coverage, and the IRS approved this workaround by treating fringe benefits differently from wages. Thus was born the link between employment and health insurance.