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Vox Op-Ed: Americans Are Not Going To Like Picking Up Democratic Socialism's Tab

Democratic socialism is the new fad hitting the Democratic Party. The far left is flexing their muscles clinching wins across the country, though they had a rough night in yesterday’s primaries; all of the candidates for the August 7 contests endorsed by Alexandria Ocasio-Cortez lost. Ocasio-Cortez is the upstart who clipped Rep. Joe Crowley (D-NY) in an upset primary victory last June. She’s anti-immigration and Customs Enforcement. She’s for every left-wing goodie bag position in the book. No wonder why she and Sen. Bernie Sanders (I-VT) get along. The progressive wing of the Democratic Party is ascendant. They’re taking some ‘ I told you so’ shots at the Democratic Party over nominating Hillary Clinton over Sanders. They say they lost because Hillary wasn’t left wing enough. They’re done with the establishment, the Wall Street ties, and pragmatic approaches to policy. They want to take a baseball bat to D.C. Does this all sound familiar? The far left is where the energy is, but their agenda is ruinously expensive. The Left is at a crossroads over whether to go full-blown left wing, though they’ve lurched to the left on some issues, like immigration and gun control. It’s still not a hard-core socialist party…yet. And by that, I mean like the UK’s Labour Party, but they’re on that path for sure. Still, as they have the ideological debate, they might want to look at their tab for their policy initiatives because while democratic socialism might be having their moment, Americans aren’t going to be happy with the bill for their Karl Marx bull crap.


At Vox, Brian Riedl, a senior fellow at the Manhattan Institute, wrote an op-ed to detail the costs for this left-wing agenda. Spoiler alert: it soars into the trillions:

…the Mercatus Center, a libertarian-leaning center at George Mason University, estimated that Sanders’s Medicare-for-all plan would cost the government $32 trillion over the next decade, setting off an intense debate. But we can do this budget exercise using only figures from nonpartisan and even left-leaning groups.

To begin with the necessary context: The Congressional Budget Office (CBO) assumes a baseline budget deficit of $12.4 trillion over the next decade (assuming current laws continue). And even these projections assume that last year’s tax cuts expire on schedule, though they may well be renewed, and that the recent two-year discretionary spending hike is not renewed in 2020. Most of this deficit is driven by the escalating Social Security and Medicare system deficits.

From that baseline, Sanders has proposed a Social Security expansion, including higher cost-of-living adjustments and higher minimum benefit levels, that the liberal Tax Policy Center estimates will cost $188 billion over the next decade.

The Tax Policy Center also scores the Sanders “free college” proposal at $807 billion over the next decade. (Note that free college benefits students from wealthy families and those whose tuition is currently affordable.)

Next, the center estimates that Sanders’s proposal of up to 12 weeks of paid family leave for new parents and for people with serious health conditions would cost another $270 billion.

Those costs, however, pale beside the cost of replacing private insurance, including copayments, with a Medicare-for-all plan. The liberal Urban Institute estimates that Sanders’s single-payer health plan would add $32 trillion in federal costs over the decade. Note that that’s the exact same figure produced by those George Mason libertarians.

Ocasio-Cortez and Senate Democrats also want to guarantee a job for anyone who wants one, at $15 per hour plus benefits. The liberal Center on Budget and Policy Priorities, commissioned a report by outside scholars Darrick Hamilton, William Darity, and Mark Paul that estimates the cost of a more modest proposal along these lines (with a lower wage, for example). It suggested the cost would be $56,000 apiece for 9.7 million enrollees, for a total of $6.8 trillion over the next decade.


Senate Democrats have promised $1 trillion for new infrastructure, and House Democrats are rallying around legislation to pay off all $1.4 trillion in student loan debt — both of which the far left generally supports. I will exclude vague promises such as universal pre-K and expanded special education funding.

Total cost: $42.5 trillion in new proposals over the next decade, on top of the $12.4 trillion baseline deficit.

To put this in perspective, Washington is currently projected to collect $44 trillion in revenues over the next decade. And the Republican tax cut, decried universally by Democrats as irresponsible (and by Minority Leader Nancy Pelosi as “Armageddon”) will cost less than $2 trillion over the decade.

The 30-year projected tab for these programs is even more staggering: new proposals costing $218 trillion, on top of an $84 trillion baseline deficit driven by Social Security, Medicare, and the resulting interest costs.


Now, for Democrats, they seem to think that the Medicare-for-all nonsense will saves $2 trillion.Andrew Gillum, a Democratic candidate in Florida’s gubernatorial race, said this recently, which was fact-checked by The Washington Post. It received three Pinocchios:

On July 30, the Mercatus Center at George Mason University released a working paper on the 10-year fiscal impact of the Medicare-for-all plan sponsored by Sen. Bernie Sanders (I-Vt.), which would transition everyone in the United States from a mostly employer-provided health system to Medicare over four years. The report was written by Charles Blahous, a former economic adviser to George W. Bush and a public trustee for Social Security and Medicare from 2010 through 2015.


…in theory would reduce the country’s overall level of health expenditures by $2 trillion from 2022 to 2031. But he makes clear that it’s a pretty unrealistic assumption.

In the fourth sentence of the report’s abstract, Blahous wrote, “It is likely that the actual cost of M4A [Medicare-for-all] would be substantially greater than these estimates, which assume significant administrative and drug cost savings under the plan, and also assume that healthcare providers operating under M4A will be reimbursed at rates more than 40 percent lower than those currently paid by private health insurance.”

Under an alternative scenario, which assumes these cuts cannot be achieved, national health spending rises even faster than under current law because health-care demand would increase.

“To lend credibility to the $2 trillion savings number, one would have to argue that we can cut payments to providers by about 40 percent at the same time as increasing demand by about 11 percent,” Blahous said.

The main point of his study is being ignored by Democrats — that even by generously accepting Sanders’s assumptions that he could squeeze providers so much, the plan would still raise government expenditures by $32.6 trillion. This is in line with a 2016 estimate by the left-leaning Urban Institute of an earlier version of the M4A plan — that it would cause federal expenditures to increase by $32 trillion. (Without the provider cuts, Blahous estimated  the additional federal budget cost at nearly $40 trillion over 10 years.)


All too often, politicians mischaracterize conclusions that are contained in academic or think tank studies. At the Fact Checker, we rely heavily on how a study’s author says the data should be presented. In this case, it’s clear that Blahous bent over backward  to accept Sanders’s assumptions, only to find they did not add up. Democrats cannot seize on one cherry-picked fact without acknowledging the broader implications of Blahous’s research.


Oh, and how do voters respond to the overall theme of single-payer health care when they realize their employer-based plans would be cannibalized so we can all equally suffer through economic destitution under the umbrella of socialism? Well, it drops like a rock (via NBC News):

The public is divided over a single-payer health care system, with 47 percent favoring such an approach and 46 percent opposing it.

But when supporters are told that all health care costs would be covered under a single-payer system — but that it would eliminate employer plans and that there would be only one government plan — the numbers move to 36 percent favor, 55 percent oppose.

The three-decade tab for this left-wing dystopia is at least $218 trillion. Hard pass. 

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