"BGE rate to climb higher in June" | baltimoresun.com

According to an article in the Baltimore Sun today, January 23, 2008 — click on the image above to see the whole article — residential electricity customers who are served by Maryland's Baltimore Gas & Electric, a subsidiary of the Constellation Energy Group,

... will pay an estimated 5.5 percent more for electricity starting in June, largely as a result of federal rules that are driving wholesale energy prices higher. ... The increase will add about $100 to the average customer's annual utility bill ... When combined with increases imposed since rate caps expired in 2006, BGE customers will be paying 85 percent more for electricity than they were before the General Assembly approved deregulation in 1999.

In 1999, the Maryland General Assembly deregulated the state's providers of electrical power in an effort to introduce competition into the electricity market and thereby hold down prices. An unintended consequence of that, combined with recent regulatory (not deregulatory) initiatives at the federal level, has been:

... more than a year into that effort [by the Federal Energy Regulatory Commission to impose new rules on the wholesale energy market], the latest increase shows just how difficult it is for state regulators to influence the federally regulated ... market. Many policy decisions affecting prices in Maryland are made in Washington with only limited input from state regulators.

"Because utilities no longer own generation plants that the state can regulate ... [utility customers are] at the mercy of what comes out of those wholesale energy markets," said Bill Fields, an attorney for the state Office of the People's Counsel, which represents utility customers.

This is just one more reason why oldstyleliberal has come to wonder whether strong government involvements in economic markets doesn't do more harm than good.

Even though Maryland has "deregulated" its electrical power marketplace, no real competition among BGE and various potential alternatives has materialized. Customers like me who live in locations where BGE once had a state-protected monopoly still don't have viable alternative providers of electrical power to buy from, eight years later. Moral: even when governments deregulate, they bungle the job.

This is something oldstyleliberal hates to admit. He is, after all, a liberal, and liberals believe that government programs help, no? Yet, time and again, government "solutions" just make bigger problems.

"Majority favors legalized unions" | Baltimore Sun

In a poll of Maryland voters, responders were asked about their views on same-sex unions. The Baltimore Sun reports that in the poll, a "majority favors legalized unions." 39% supported civil unions, but opposed gay marriage. Another 19% supported gay marriage outright. A solid majority, 58%, thus supported some sort of legalized same-sex union. That surprised oldstyleliberal.

Meanwhile, 31% opposed legalizing same-sex unions in any form.

Maryland's governor and legistlature are expected to take up the issue this year. Gov. O'Malley has said he favors civil unions, while being against gay marriage. The President of the State Senate, Thomas V. Mike Miller, a Democrat, opposes both civil unions and same-sex marriage, while supporting "increasing rights for same-sex couples," such as those concerning property ownership and medical decision-making. Another leading Democrat, House of Delegates Speaker Michael E. Busch, endorses civil unions but apparently not same-sex marriage.

Per the Sun, "Maryland law defines marriage as a union between a man and a woman. A lawsuit seeking to overturn that statute failed last year, effectively moving debate over the issue to the State House."

Republicans in the State House may introduce a measure to amend the state constitution to ban same-sex unions:

Foes of gay marriage also plan to push their cause this year. Del. Donald H. Dwyer Jr., an Anne Arundel County Republican and one of the General Assembly's most outspoken critics of gay rights, said it is time for the legislature to vote on all of the proposals so that constituents know where their representatives stand. He plans to sponsor a constitutional ban on gay marriage and civil unions.

The Sun article says that "only half of [the 31% of poll responders who opposed same-sex unions] said a constitutional amendment is needed to ban them."

Gay rights advocates "are pushing for a marriage bill with an exception to make it clear that no religious institutions or clergy would be compelled to perform or recognize those marriages."

In other words, opinions are all over the map on this issue in Maryland.

oldstyleliberal thinks gay marriages — secular, not religious — ought to be made legal. If that is impossible politically, then civil unions ought to be legalized, as they are marriages in all but name, conferring all of the legal rights that heterosexual marriages do. But outright recognition of gay marriage would be better, as it forecloses on the legal hair-splitting that is sure to arise if civil unions become law.

***

"Maryland bishops speak up for marriage: Statement supports marriage as union of man, woman," says a headline in a recent issue of the Catholic Review. The article began:

Archbishops Edwin F. O’Brien of Baltimore and Donald W. Wuerl of Washing­ton, D.C., and Bishop Michael A. Saltarelli of Wilmington, Del., released a statement Jan. 5 supporting the traditional definition of marriage.

The statement, “Marriage in Maryland: Securing the Foun­dation of Family and Society,” was distributed to all parishes for inclusion in January bulle­tins by the Maryland Catholic Conference (MCC), the legis­lative lobbying arm of Mary­land’s Catholic bishops.

Though oldstyleliberal is a Catholic — and not gay — he disagrees with the Church's position on marriage as a matter of civil law, as opposed to a religious sacrament, which it is in the Catholic Church. As a sacrament, whether marriage can be extended to include same-sex couples is a theological question which oldstyleliberal is frankly unable to resolve. As a civil matter, however, marriage ought to be open to all comers, gay or not.

oldstyleliberal thinks this is a good Christian way of looking at things, in fact.

We Christians believe, or ought to, that making love (in all senses of the word) trumps the ability of a married couple to make babies. The Catholic Church insists that a married couple be open to conception and childbirth at all times — supposedly impossible (depending on what "open to" means) for a same-sex couple. Being open to procreation is, however, not contradicted when a heterosexual couple is infertile, or when the husband and wife use the "rhythm method" to avoid pregnancy (since the woman is biologically infertile at certain times of the month). Why doesn't the exception for biological infertility apply to same-sex couples?

According to the CR article, a priest who is pastor of a local Catholic church said:

“Mar­riage is a sacred institution.” If the definition of marriage were altered, [the priest] said, “It would undermine a pillar of our society and would be a terrible fall down the moral ladder.”

oldstyleliberal doesn't buy that. oldstyleliberal thinks allowing gays and lesbians to marry would, if anything, improve the moral tone of society. For one thing, it would cut down on promiscuity among gays if gays could have settled marital relationships. Promiscuity is bad; gay sex is (for gay people) not.

For another thing, having a married gay couple next door might teach the rest of us to be more accepting and tolerant.

"O'Malley to offer energy package" | Baltimore Sun

This morning's Baltimore Sun has a front page article about how Maryland's recently elected governor, Martin O'Malley, is responding to looming energy and electrical power shortages in the state. The headline is "O'Malley to offer energy package." The article says that among the measures the governor's energy administration contemplates submitting to the legislature is a bill to have the state's power companies contribute money to a "strategic energy investment fund." The fund in turn would "invest in energy-efficient technologies and promote nonpolluting power alternatives."

oldstyleliberal lives in a suburb of Baltimore, Maryland, and buys his electrical power from Baltimore Gas & Electric, a part of the Constellation Energy Group. BGE and companies competing with it to sell electrical power in Maryland in 2006 ruffled consumers' feathers mightily by announcing steep price hikes. The rate increases were softened somewhat when politicos in the state legislature objected and threatened to take severe action — see New Electricity Rates on Tap for Maryland.

Since then, now-Governor O'Malley, a Democrat who was Baltimore's mayor at the time, ran against and defeated a Republican incumbent, Governor Robert L. Ehrlich. O'Malley, says today's article, "campaigned on the unfulfilled promise of undoing a 72 percent electricity rate increase for 1.2 million Baltimore Gas & Electric customers." This set of new proposals floated by the O'Malley administration instead "appears likely to ... further increase consumer costs in the short term."


The energy fund portion of the proposed legislative package — which also eyes laws "reducing overall electricity consumption by 15 percent by 2015" and "requiring utility companies to buy 20 percent of their power from wind, solar or other renewable sources by 2022" — would "not rely on tax revenue. Instead, the governor is banking on proceeds from the auction of "pollution credits" under an initiative of 10 states to voluntarily reduce carbon dioxide emissions." CO₂ emissions are a major part of the "greenhouse gases" that are said to promote global warming.

The O'Malley brain trust is banking on a regional "cap-and-trade" system, just getting under way, to generate something like $100 million in windfall revenues that would wind up in Maryland's energy fund. The Sun article is not totally clear on how this would work; it says, "Maryland expects to receive about $100 million a year from the sale of its pollution credits." This has to do with the Regional Greenhouse Gas Initiative, under which power plants in ten voluntarily participating Northeastern and Mid-Atlantic states, including Maryland, "must keep emissions below a downward-sliding limit, or buy credits from cleaner power plants."

The assumption here may be — it's not perfectly clear to oldstyleliberal — that power plants in other RGGI states, because they emit more greenhouse gases into the atmosphere than Maryland plants do, would have to buy up some of the permits issued to the (relatively clean) Maryland plants. The money the Maryland power utilities would receive would, under the O'Malley plan, wind up in the energy fund. That way, Maryland utilities would supposedly not have to pass along the costs of filling the fund to their customers in the form of higher electric bills.

At least, there is that hope. O'Malley's political opponents are, however, skeptical:

Del. Warren E. Miller, a Howard County Republican on the [Maryland House of Delegates] Economic Matters Committee, said he doubted that the "cap and trade" system would create even a $100 million windfall, and that added costs borne by power plants would probably show up on consumers' electrical bills.

The dollar size of the permits windfall is in doubt in part because "the yield won't be known until the first [RGGI] auction this summer." But Maryland Public Service Commission Chairman Steven B. Larsen, an O'Malley appointee, said (according to the article) that he expects "the amount could be twice as high."

There is also this consideration: " ... recent tax increases and economic uncertainty might spur a fight in the legislature this session if lawmakers prefer to give all or some of the $100 million back to consumers."

It sounds to oldstyleliberal as if the O'Malley people want to make sure one of two things happens:

1. If Maryland's power producers do reap an RGGI windfall, it (because the money goes right into the new fund) won't wind up reducing consumers' electric bills. Lowering electric rates would give consumers no incentive to conserve energy. That would wind up exacerbating global warming.
   
2. If by chance there is no such windfall, utilities would still have to pay the required money into the new fund, which would cause electric rates to go up as the utilities pass some or all of these costs on to consumers. Higher rates would encourage even more conservation.
   

Either way, the recently boosted Maryland electricity rates would tend not to go down, as O'Malley suggested on the campaign trail that he wanted, and might well go up. No matter where the money to be injected into the new energy fund comes from — from an RGGI windfall or from Maryland power companies' general revenues — it will ultimately come from energy consumers in Maryland, and/or those in other states participating in RGGI.

So the proposed fund would encourage energy conservation and ameliorate global warming in two ways. It would invest in sustainable, environment-friendly energy technologies. And it would encourage energy conservation by in effect adding a hidden surcharge on electric power consumption in Maryland, or elsewhere, to pay for the fund.

Megan McCardle: "No Country for Young Men" | The Atlantic

In "No Country for Young Men," in the January/February 2008 issue of The Atlantic, associate editor Megan McCardle paints a bleak picture of what we're headed for as we Baby Boomers (yours truly is 60) start spending more time in doctor's offices and the old folks' home than we do working and earning our keep.

We geezers-to-be are already starting to retire, but many officially "retired" Boomers are starting some sort of second career as they exit career #1. They'd like to find "work-as-personal-fulfillment" and all that sort of thing, yet many find themselves limited to a less-than-wonderful job at Wal-Mart or Home Depot, Staples or Walgreens.

Still that's not the big problem. The big problem comes when they get too old to contribute labor to the workforce in any way, shape, or form. Then they'll be living off the productivity of their juniors, at a time of life when their, the seniors', medical expenses can be expected to grow and grow and grow.

McArdle:

And indeed there’s no getting around these facts: in 1945, the year before the Baby Boomers began entering the world, each retiree in America was supported by 42 workers. Now each retiree is supported by three. When the Boomers are fully retired, each of them will be supported by just two.

What happens when currently optimistic Boomers finally face the hard realities of their savings accounts? Will they ask for more from the government? At a bare minimum, seniors already struggling with their finances are not apt to look kindly on benefit cuts. Yet the cost of the benefits we’ve already promised them will weigh heavily on the workers expected to support a half-Boomer apiece.

Social Security is the comparatively easy problem to solve. It will go from consuming 4.3 percent of GDP in 2007 to absorbing about 6.2 percent in 2030. That’s a big jump—if the cost were spread evenly, it would be equivalent to about a 5 percent increase in payroll taxes for each worker—but by and large, the economy will be able to cope.

Medicare is a different story. Health-care costs now consume about 16 percent of GDP, but projections by the Department of Health and Human Services suggest that by 2016, that will have risen to almost 20 percent. [David Wise, head of the National Bureau of Economic Research’s aging program,] speculates that closing the Medicare budgetary gap would require a tax increase of something on the order of 8 to 12 percent of total payroll. That is a massive tax increase—$4,000 to $6,000 a year on a $50,000 income (again assuming the tax were spread evenly). Many economists and budget analysts have drawn up plans intended to fix Social Security, through some combination of benefit cuts, higher retirement ages, and tax increases. But almost no one claims to have any good ideas about Medicare.

As oldstyleliberal mentioned in Samuelson: Rx for Health Care, by 2030 health-care costs will most likely eat up 25 percent of GDP! A quarter of every dollar's worth of products made by Americans will be earmarked for medical bills alone. A hefty portion of that will go to pay the medical bills of Medicare recipients.

In other words, we're presently tied to a railroad track with a locomotive bearing down on us at breakneck speed. And "no one claims to have any good ideas about" how to loosen the rope.

The presidential candidates have said very little about Medicare. The Republicans want to chip away at the various reasons why health care costs in America are rising so fast, and that's good. Also good is the Democrats' insistence that all Americans who want to be insured can be (or, in some of their proposals, must be). But no one is talking about how something else — something really big, and something fairly painful, politically — is going to have to be done, and soon, to keep Medicare from killing the goose that lays America's golden eggs.

David Brooks: "Middle-Class Capitalists" | New York Times

David Brooks' op-ed column in the New York Times of Jan. 11, "Middle-Class Capitalists," contains some interesting information about the Republican presidential candidates' positions on health care reform:

While Democrats emphasize [insuring] the uninsured, Republicans emphasize cost control. They [unlike an earlier generation of Republican conservatives] understand that it’s not a question of protecting health markets from government takeover. Government already controls and distorts health care. It’s a question of straightening out the system so that it is clear who is paying and for what.

Mitt Romney supports private insurance enforced by a universal mandate. [John] McCain talks about paying for outcomes rather than tests to cut down on unnecessary procedures. Mike Huckabee promotes an activist agenda to reduce obesity and prevent chronic illness.

When Brooks says "government already controls and distorts health care," that sounds like a bit of hyperbole to oldstyleliberal. But it's basically true. It's verbal shorthand for the idea that, mostly by virtue of running market-distorting programs like Medicare, Medicaid, and the State Children's Health Insurance Program (S-CHIP), Uncle Sam (along with state and local governments) influences the supply and demand relationships that pertain to medical-care goods and services.

That affects in a major way what health care items patients (or their insurers) can buy, and how much it will cost them to buy it. Accordingly, certain health care categories may cost more than they otherwise would, because (government-subsidized) demand for them is higher than it would otherwise be.

Because of said marketplace distortions, certain things may wind up being in too-short supply, even at higher prices; there may be too few doctors in a certain area of the country, because bureaucrats there have decreed that local health care providers don't get paid as much as they do elsewhere. So it may take a while to get a doctor's appointment in East Podunk. Meanwhile, there may be too many doctors and health care facilities in other areas, so eager patients may wind up having too many health care services bestowed on them, with no measurable improvement to their health, life expectancy, or any other objective indicator of the quality of their health care.

But, Brooks implies, GOP reform proposals (and those of Democrats) will not eliminate these market distortions. They simply hope to "straighten out the system" by at least making it more "clear who is paying and for what."

In the health care financing system as it is currently set up, it is not at all clear who pays for what. Even if you don't personally get any benefits from Medicare, Medicaid, or S-CHIP, and even if you do not have employer- or individually provided health insurance — you buy your medical care on a pay-as-you-go basis — you are probably already shelling out for the health care of other people.

If you, as a "young invincible" who normally "never gets sick," happen to undergo an emergency appendectomy at a local hospital, the bill which you are going to pay entirely out of your meager savings account probably has been inflated to help the hospital defray the costs of patients whose government-provided insurance programs — because of price controls or coverage limitations — don't fully defray the expense of treating them. That's what policy wonks call "cost sharing," and it also applies to the costs of treating charity cases: patients who have no insurance at all, government-provided or otherwise.

Cost sharing already distorts health care markets. Even if the government completely got out of the health care financing business — which is politically impossible, owing to the popularity of Medicare — and even if private insurers and HMOs acted in a totally greedy way to inflate their bottom lines at the expense of providing everyone with the health care we all so desperately need, the very fact that each of us can expect to use more health care than we can pay for, at some point in our lives, means cost shifting is inevitable. If all of the other market-distorting aspects of health care financing — government insurance programs, tax incentives to employers to provide health insurance for their workers, state regulations, etc. — disappeared overnight, cost sharing for charity cases would remain. And a great many of us, lacking huge financial reserves, would at some point become its beneficiaries.

So it is not a question of ever having a strictly market-based health care financing system, with zero distortions to "pure" supply-and-demand relationships. The "market footprint" of the government is, and will remain, huge. And unless we went to a full-bore "single payer" system of government-financed health care — an idea that has completely failed to gain political traction in America — there would continue to be private insurers, employers, doctors, hospitals, and managed care organizations who quite naturally fear their health care costs are getting way out of proportion to their levels of recompense. In a pinch, these entities, as recent history shows, tend to want to cut back their outlays — at the expense, too often, of making it too hard or even impossible for the sickest among us to get the care they need.

The Republicans all want to re-jigger the current system in various ways short of a single-payer system or a mandate that those who lack health coverage must buy it from the government. Romney would mandate the purchase of private insurance and would presumably arrange (somehow) for it to become available and affordable to all (good luck there!).

McCain would control health care costs by "paying for outcomes rather than tests." By that, oldstyleliberal assumes, McCain means health care providers would not be able to charge public or private insurers for procedures that don't measurably improve patients' health — though how that would be adjudicated is admittedly a bit of a mystery to oldstyleliberal at this stage.

And Huckabee emphasizes promoting "an activist agenda" to keep us from incurring serious (and expensive) illnesses in the first place: a noble goal, but again, good luck!

On the other hand, most of the GOP hopefuls' health care platforms contain, somewhere in the fine print, a plank that would permit the health savings accounts (HSAs) that became available to Americans under a 2003 law to become larger and less restricted. oldstyleliberal thinks this is a good idea. Accounts which are stocked with tax-free money, year by year, and which can be drawn upon at any age to buy health insurance and/or health services, while remaining tax-free, are a fine thing.

Right now, if you establish such an account, you are forced to buy so-called high-deductible health insurance along with it. The enlarged HSAs proposed by various Republican presidential hopefuls would eliminate that restriction and other drawbacks which keep HSAs from being as popular as they might be. oldstyleliberal thinks "large HSAs" would be the perfect complement to a universal-access health care plan such as Democrat Barack Obama proposes, which would make government-provided health insurance available to all adults and children but would mandate coverage only for children.

Samuelson: Rx for Health Care

Newsweek economics columnist Robert Samuelson recently prescribed this Rx for Health Care in the December 10, 2007, issue of the magazine. oldstyleliberal feels the article should be required reading, not because he necessarily agrees with all of Samuelson's solutions, but because it captures some of the essential dimensions of the problem which confronts all of us in this election year and beyond.

Dimension 1: "Health spending already totals more than $2 trillion annually, about 16 percent of national income (gross domestic product). By 2030, it could easily exceed 25 percent — one dollar out of four — projects the Congressional Budget Office. Higher health spending is the main force expanding the federal budget."

Those figures presumably include both private and government expenditures on health care, whether they come out of patients' pockets to cover their medical expenses, copayments, and insurance premiums; out of insurance companies' payments to health care providers; out of employers' payments to insurance companies to provide health coverage to the employers' workers; out of government health care payments through programs like Medicaid and Medicare; or what have you. Total it all up, and we Americans now carve 16 cents out of every dollar of our income "pie" to spend on health care, on the average, and within the lifetimes of many of us, that number will go up to a shiny quarter of a dollar or more.

Dimension 2: "There's a massive transfer of income from young to old. Americans 65 and older now represent about an eighth of the population and about a third of all health spending. By 2030, their population share will be about a fifth, and they could account for nearly half of health spending, finds a study by the Centers for Medicare & Medicaid Services. Under present law, the 19- to 64-year-old population would pay most of those costs."

Put those two dimensions together, and by 2030 working adults between the ages of 19 and 64 will be covering the lion's share of the nearly half of total health spending that seniors will by that time represent. That's roughly a dime out of every dollar of each youngster's income. Under present law, every able-bodied member of the pre-retirement workforce would have to fork that dime over in one form or another to underwrite the health care of doddering Americans. Hence the description, "massive transfer of income."

Dimension 3: "Neither the government nor the private sector has succeeded in controlling health spending. From 1970 to 2005, average spending per Medicare beneficiary rose 8.9 percent a year; spending for Americans with private health insurance rose 9.8 percent annually over the same period (the figures cover similar health services). The small difference may reflect cost shifting. When Medicare imposes price controls, doctors and hospitals increase prices for privately insured patients."

Think about that a while. Recent history has shown that health care prices are not held in check either by market-based activities of private insurers and health care providers looking to improve their bottom lines or by government agencies trying — and failing — to rein in costs through price controls.


Samuelson says we Americans don't see how the money flows through the complicated plumbing of today's health care system. It comes out of the pockets of us all, but in hidden, indirect ways. For instance, the health insurance coverage an employer buys for a worker is paid for — in part, since the worker also pays in premiums — by money the employer gives the insurance company. That money could alternatively have come directly to the worker as higher wages. But the worker never sees that.

When governments, federal and/or state, provide insurance coverage, as in Medicare, or subsidize patients' health care costs directly, as in Medicaid, some of the expenditures come out of general tax revenues, largely derived from income taxes or sales taxes. Again, the taxpayer doesn't see his or her tax dollars flow through the system and come out in the bank account of a doctor, nurse, technician, hospital, or pharmaceutical manufacturer.

Meanwhile, the patient himself or herself racks up expenses that are — apparently — paid for by other people. Other members of the same insurance plan. Other taxpayers. Other patients at the same hospital, through the accounting practice called cost shifting. Whoever the "other people" are is hidden from the patient's view, and the patient has no incentive to comparison shop for the lowest prices consistent with getting the best quality of health care services.


Often, the patient not only has no incentive to shop for health care bargains, he or she simply cannot do so. Perhaps the prices for drugs and other commodities are fixed at a certain level by the health insurer's agreements with providers in its network, so shopping around is pointless. Or perhaps there is only one available source of whatever it is the patient needs, because the health care system limits competition as an unintended consequence of how it is currently set up.

Patients today are therefore not really "consumers" in the usual sense of the word: people who desperately prefer to keep prices as low as possible when they shop for goods and services, and who avoid paying too much by bargain hunting.

And that, oldstyleliberal thinks, is both a good thing and a bad thing.

It's a good thing because, if you need a heart bypass, a liver transplant, or a mastectomy, the last thing you want to do is shop around ad infinitum for the best quality-to-price ratio. That takes time and effort when what you really want to do is get the scary thing over with as quickly as possible. You want to put yourself in the hands of the best surgeon you can find, and not necessarily the one who charges the least. You're unexpectedly sick — or maybe you've finally found a solution for a debilitating condition that's been sapping your strength for a long time — you're frightened, and you just don't want to die. So careful comparison shopping is not going to be uppermost in your mind.


But the fact that the current health care system pretty much obviates the need for comparison shopping and bargain hunting is also a bad thing because, as Samuelson points out, it is driving the explosion in health care expenditures. As a 60-year-old, oldstyleliberal can easily remember when there was not all that many surgical remedies available for heart patients, there were no liver or bone marrow transplants, there were no CT scans or MRIs, no screenings for breast cancer.

Medical care was pretty cheap in the days when penicillin was still the latest wonder drug. There was nothing that could be done to prevent you from getting tuberculosis or polio in 1947, oldstyleliberal was born, and if you did get one of these dread diseases you could easily die from it without ever racking up a lot of the life-prolonging medical expenses associated with ongoing patient care today.

Or you could wind up crippled or in diminished health for the duration of a normal lifetime — yet the monetary costs associated with post-polio or post-tuberculosis status were not all that high. President Franklin Roosevelt, a polio victim, could do little but visit the spa at Warm Springs, Georgia, and wear braces on his legs.

Sick by Jonathan Cohn

The current health care financing system actually got its start in the days of FDR: the great depression, World War II. Sick: The Untold Story of America's Health Care Crisis — and the People Who Pay the Price, by Jonathan Cohn, is more must-reading for Americans today. It details (among other things) how employer-provided health insurance got its start during the Second World War, at a time when employers were trying to attract workers from a labor force diminished in size by all the boys in uniform overseas. Uncle Sam gave employers a big tax break for the health insurance coverage they were starting to offer as a fringe benefit to their employees, and private employer-based health insurance soon became an American institution.

At the time, as already noted, health care costs were moderate for even the sickest among us. The fact that being covered by insurance took away a patient's incentive to price-shop for health care had little negative impact. Things are a lot different now.


A little back-of-the-envelope figuring shows that when $2 trillion is spent each year to provide health care for 300 million Americans whose average life expectancy is 78 years, then every American will on average use $5.2 million worth of health care over the course of a lifetime. Think of it. Even in this age of homes that cost more than $1 million, that figure dwarfs what used to be considered the single most expensive thing a middle class person would most likely buy in his or her life: a house.

Of course, the prices of health care have gone way, way up, and way too fast, so oldstyleliberal figures the amount of money actually spent on his own health care needs during the first 60 of his allotted 78 years has been much less. Then again, if prices keep skyrocketing, he may still wind up costing the health care system $5.2 million by the time he is done.

A baby born today can expect to cost the health care system a lot more than $5.2 million, owing to the fact that health care costs continue to zoom upward. Something must be done, and soon.

As Samuelson points out in his article, "People need to see and feel health costs." Whatever else we do, we have to stop letting health care consumers proceed as if they're getting a free ride (even if the dollars they don't think they are spending on health care are actually feeding the present system in hidden, indirect ways).

Samuelson want to: "First, make Medicare beneficiaries pay more; many retirees can afford more. Second, create a dedicated federal health tax to cover all government health spending (Medicare, Medicaid, etc.). If health spending rose, the tax would rise. People would know why."

Third, he wants to "eliminate the income-tax exclusion for employer-paid insurance and replace it with a tax credit of lesser value. Workers would have more pretax income, but they'd have to spend more after-tax dollars for insurance."

Of the three proposals, oldstyleliberal likes the second one best. He thinks there ought to be a dedicated federal health tax as an income surtax. It ought to cover all of Uncle Sam's health care expenditures, such that Medicare, Medicaid, S-CHIP, and the various other programs would not draw from general revenues at all. It would be charged at a flat percentage of income; there's no sense in alienating economic conservatives by making it progressive, so as to take a proportionately greater bite out of the pocketbooks of the rich.

Starting it at a flat (say) 5 percent of income would make it easy for Americans to see how the rate was changing from year to year and ask embarrassing questions of politicians if the rate went up too much — and that's the whole point.

Meanwhile, oldstyleliberal favors substituting for Samuelson's first and third proposals — designed to re-jigger the monetary disincentives of the current health care system to patients to comparison shop and thus hold the line on prices — so-called "large HSAs": health savings accounts with fewer restrictions than today's HSAs currently have. Americans would use these accounts as "401(k)s on steroids" to replace or amplify the proceeds of regular health insurance coverage with their own tax-free dollars — dollars that it behooves them to spend wisely.

Cynthia Tucker: "Obama's Rise Signals Shift" | Baltimore Sun

Kudos to op-ed columnist Cynthia Tucker for pointing out in "Obama's rise signals shift," available at BaltimoreSun.com, that few of us are being really upfront about how we're dealing with Barack Obama's blackness. Says Tucker, who is black:

While this country has made great strides toward genuine racial equality over the last 50 years, we're still hampered by a race-consciousness that lurks just below the surface, in our reptilian brains, where stereotype, prejudice and unconscious judgments override rational considerations. That's true for all of us — black, white and brown.

oldstyleliberal is white, and although he intends to vote for Obama in the upcoming Maryland Democratic primary, he has to admit there were parts of Obama's victory speech in Iowa during which he had to tamp down a negative reaction to the vocal cadences Obama was employing, which he realized were right out of the African-American pulpit. Whoa, thought oldstyleliberal. Where did Obama, who wasn't raised in such a church, pick that up — from Al Sharpton?

Another part of oldstyleliberal's brain duly kicked in and said something like, "Shame on me for even feeling that." If Obama, whom some African-Americans have deemed "not black enough," can't appropriate the rhythmic, rhyming cadences and grunts of a Jesse Jackson or an Al Sharpton, how can he possibly bring American blacks along with him into a new ethos of political "change."

All of us, black, white, or brown, respond to what one might call "extra-rational" rhetorical cues that are intended to say, "You and I are the same." But if these cues are designed to pull some folks toward a candidate, other folks who might otherwise feel a bit alienated by them have to be smart enough to cut that candidate, who after all wants to lead us all toward some brighter day, a degree of slack. Right?

All of which brings up the question, just how do we decide, individually and corporately, what our opinions are about candidates and their programs? As Ms. Tucker says, there's a lot going on just below the surface, in our "reptilian" brains, which we can't very well admit to, but which might wind up making all the difference in the world.