Elizabeth Warren’s campaign may be over soon.
But before she disappears, let’s learn from what may have doomed her campaign, her stance on health care. Some of my friends who know that I’m a latecomer to Medicare for All might be surprised I’m enthusiastic about it now. And those who believe some of the silly stuff Sanders’s supporters said about Warren’s version of M4A, will be outraged that I think Warren has something to offer on this subject.
Going really bold and then pulling it back was not smart politics by any means. Warren pulled off a political self-hat trick. First, she offered a bold M4A plan that scared the centrists. Then she offered an interim health care plan that the left felt was a betrayal. And, ultimately, she made everyone wonder if she knew what she was doing. But for reasons I’m going to explain, both her ultimate goal and her path towards it makes a huge amount of sense and not just in dealing with the critical issue of health care but in addressing two central difficulties with our economy.
It may be too difficult and controversial to explain in a presidential campaign—and Bernie may be smart just to lay out the goal and not get into details—but I’ve come to think that fixing health care in the right way could have an incredibly important impact on working-class—including white male working-class—support for left aspirations and a Democratic Party that embraces them. Moving towards M4A in the right way is not only a path to living up to the idea that healthcare is a fundamental right, and to relieving a main source of anxiety that, in a complicated way I’m going to explain soon gives power to racism and sexism, it is the policy tool we need to make a dramatic, and relatively quick, assault on the extreme inequality that plagues our country.
And if I’m right, the policy Warren clumsily outlined and defended is the policy that a President Sanders and, also a President Biden, would have to follow.
It’s going to take me a minute to explain all that. So I’m going to get there by talking about the three reasons I’ve come to support Medicare for All after I take a brief detour and remind you why I don’t think it is absolutely necessary to make quality, affordable health care available to all.
There is no reason in principle that we can’t secure the moral right to health care with an expanded ACA. Strengthen regulations on health insurance companies to make them basically public utilities, the way they are in the Netherlands, and spend another $300 to $400 billion a year or so to make subsidies much better for everyone and health insurance without deductibles and co-pays would be affordable for everyone. Add a public option and we can do it for even less money. Strengthen the incentives under the public option to move from fee for service to value-based care / bundled payments and create competition among accountable care organizations to discover the best ways to provide care and encourage healthy living—which is actually a far more radical and needed transformation in health care than Medicare for All—and we can do it for even less and get health care inflation under control.
Those on the left who say that only Medicare for All can give everyone a right to health care are mistaken. Universal coverage is attained at lower cost in the multiple payer systems of France, Germany, and the Netherlands. Reforming the ACA in the three ways I suggest would get us to those universal health care systems without a single-payer plan.
So why have I come around to support M4A? For three reasons.
First, I realized that an argument I made in the past—that a single-payer system would make it harder rather than easier to replace fee for service—is no longer true. It will always be true that overcoming the opposition of doctors, hospitals, and health care conglomerates to changing how we pay for health care will be difficult because it will reduce their incomes. And I still fear that moving Medicare for All without ending fee for service will lead to an explosion of health care costs that will eventually force government instead of insurance companies to either ration health care, which would undermine support for government, or keep raising taxes not just on the rich but on working people.
However, I now think the growing strength of the progressive movement makes it possible to move to single-payer and end fee-for-services at the same time. And if that movement can help fight off the demands of the medical-industrial complex, we can use the M4A system to create the competition between different health care organizations that is necessary to figure out how to create value-based care / bundled payment systems that deliver better care at a lower cost.
Second, Warren’s campaign figured out how to deal with the two political objections to M4A that led progressives who previously supported single pay to the ACA approach 12 years ago. First, she recognized that if we are willing to create a financial transaction tax and raise the wealth tax on billionaires high enough—and also insist that businesses be required to keep paying the employer share of health care costs into the fund that supports M4A—we can cover the cost of M4A with no tax increase on the working and middle classes at all. Second, she’s made a strong case that if (1) we give people an economic incentive to choose an optional M4A plan rather than employer-based system and (2) give the businesses that employ them an incentive to push their employers into the M4A system, people will move into the M4A system quickly over just a few years. (And that’s as fast as it can happen under any system.)
The good experience people would have under a new, partial M4A system would show people who are scared of it that it’s a way to secure excellent health care at a lower cost and without co-pays and deductibles. Enough people would then choose to get their health insurance from the M4A plan that the political backlash to finally ending private insurance will be insignificant.
In other words, Warren has devised what Andre Gorz called a reformist reform, one that creates the political conditions for its own expansion. Warren’s M4A plan is not like what we have seen from Biden and Buttigieg—an ultimately unworkable compromise with M4A in which the public option plans are more costly than the private insurance offered on the exchanges. It’s a clever political strategy for overcoming the opposition to M4A over a period of four to five years.
And having that political strategy is important. Those who think Bernie’s M4A plan is better than Warren’s are not really thinking strategically about how to create M4A—or recognizing that both the Warren and Sanders plans (to the extent that there really is a Sanders plan) end up in the exact same place. Unless an earthquake happens in 2020, Bernie Sanders is not likely to find the votes in either the House or Senate to pass M4A in their first year, even with the strong movement for it that he hopes to create and lead. Strong political leadership is not just about making demands and building popular support but about devising a political strategy that can overcome opposition in a constitutional system that gives way too much power to rich and powerful minorities. Warren has a strategy that can create the political conditions that will actually let her enact M4A in her third year or fifth year as president. (And, as I’ve pointed out, it’s a misreading of our history to think that presidents can only accomplish big things in their first year.) I’m quite sure that if Bernie is elected president he will follow the exact same strategy because it’s the only one that gets us where we need to go.
Third, and most importantly, one of the ways Warren’s plan builds support for single-payer shows that M4A is a critical way to attack inequality and thereby make progressive Democrats an overwhelming majority of the party once again. If taxes on the rich and corporate contributions pay most of the freight for M4A, eliminating the cost of health care insurance for those who pay for it themselves will dramatically increase the income available to working-class and middle-class people. In other words, moving to M4A is not just about insuring the uninsured or about reducing the cost of health care. It’s about massively redistributing income and wealth from billionaires to working people.
There are a lot of reasons that wages have been stagnant since the ’70s, but one of the most important is that health care costs have exploded and people are paying for health care out of their wages, in the employer and employee share of costs, and both if they are self-employed.
Given the power of capitalist economic ideas in America, it’s difficult to imagine enacting legislation that would redistribute $2 billion a year from billionaires directly to the rest of us. And that’s true even though wealth inequality has gotten to the extraordinary point at which there really is so much wealth in the hands of billionaires that political and economic justice requires that we engage in a massive redistribution of that wealth.
A proposal to tax the wealth of billionaires to redistribute their income will be politically difficult for some time—though not forever, I hope. A proposal to tax the wealth of billionaires to pay for health care, however, is both possible and enormously popular right now. And done in the way Warren proposes, it would raise the income of the average family that pays for health insurance now by about $8,000 a year while also insuring the uninsured. That is, to quote a phrase, a big fucking deal.
We all talk about whether and how to overcome the declining support of white working people for Democrats, especially given the power of racism, sexism, and anti-immigration sentiments. There is no easy answer. But raising family wages by $8,000 a year and doing it relatively fast would be a really good way to start the process. Doing that, while also reducing the enormous anxiety all of us have about whether we can pay for health care, will make an extraordinary impact on how working people live in this country. (As I explain in my forthcoming essay about the rise of Tump’s fascism, it is a certain kind of economic anxiety and uncertainty, not just low wages and high costs that generate the backlash against Black people, women, and immigrants that led to Trump.)
Massively redistributing income and reducing economic anxiety by putting M4A in place will also revive our economy from the bottom up, creating jobs in health care and far beyond as consumption drives our economy forward. The huge increase in consumption that will be generated by redistribution from people who have so much money they just save it to those who have so little they spend every penny will give businesses the reasons to invest they do not have now, despite easy capital.
The income and security provided by an M4A paid for by a wealth tax will be as dramatically important to working people and to our economy as the New Deal and its promise of jobs and Social Security was. And just like the New Deal, M4A has the potential to again make working people, as well as their children, Democrats for the rest of their lives.
Perhaps this is all too hard to explain simply and in the heat of a campaign. Perhaps we will have to wait for President Sanders or Biden to move us in this direction without proposing it in the election. And unless Biden is as I fear, as conflict-averse and economically ill-educated as Obama, he, too, will try to move us in this direction. There is just no sensible alternative.
At any rate, my point here is not to make recommendations about who we should support in the Democratic primary process but to recognize that whatever her fate in this election, Warren has put forward, without fully explaining them, some very sensible ideas about what M4A can accomplish, and how to achieve them. These are ideas all of us should embrace.
Again, I don’t know if there is a way to make the case for what I’m suggesting in the election. I haven’t quite figured out a way to explain this quickly and without raising concerns that it is all pie in the sky. And that was part of Warren’s problem. People don’t really understand that inequality has gotten to the point where a pretty modest wealth tax of 5% can, together with the current contributions corporations make to health insurance, pay for most of M4A. And for the reasons I’ve explained, it should—and the sooner it does, the better off we will all be.