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• William Greider wonders whether we should dismantle the Federal Reserve.

Should progressives embrace cost sharing in health care?

What mortgage-backed securities and lemons have in common.

That California budget deal doesn't look so hot.

Do blood tests decrease marriages? Do recession increase dating?

By the way, I'll be on Greta Van Susteren's show tonight talking health care. Should be toward the top of the hour.

Update: Greta canceled on me. Was it something I said?

By Ezra Klein  |  July 21, 2009; 6:20 PM ET
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Next: The Mid-Session Budget Review


Ezra says (in his article), "In 30 years, Medicare alone will be almost 8 percent of GDP. Give it a few more decades and it'll take more than 10 percent"

Uwe says, "If "economic sustainability," then exactly what do people have in mind with that phrase? During the past 4 decades or so, the long-run, smoothed average annual growth rate in real (inflation-adjusted) GDP per capita has been about 2%. Suppose that fell to only 1.5% for the next four decades. The current average real GDP per capita of about $40,000 would then grow to about $72,500 by 2050 in constant-dollar terms. Medicare now absorbs about 3% of GDP, leaving a non-Medicare real per capita GDP of $38,800. It was estimated by the CBO about a year ago that Medicare will absorb about 9% of GDP by 2050. Let’s make that 10%. At these numbers, the non-Medicare real GDP per capita available to today’s little critters who will run America in 2050 will still be close to 70% larger than is our current non-Medicare GDP per capita."

Please Ezra, the problem is not in the cost of Medicare. It's in the rest of the system.

Also your main premises in the article isn't supported by the data. As I've written many, many times, we can give everyone Medicare (or some other efficient system that gets rid of private insurance) and it will cost us no more than we are now paying and probably less. We will stil be paying twice as much per person as everybody else, but at least people will not be dying or going bankrupt because they lack health insurance.

As you may recall, I don't believe these simple minded projections, but you do, so you must notice that Medicare is not increasing as fast as healthcare in general in the US. And we will have a mechanism to work on improving medical practice.

Posted by: lensch | July 21, 2009 9:08 PM | Report abuse

The market for lemons concept has nothing to do with citrus fruit - it's about a model of the used-car market.

Posted by: albamus | July 22, 2009 7:18 AM | Report abuse

The problem I have with the "bending the cost curve" rhetoric is that all of the proponents seems to be ignoring the most obvious way of bending the cost curve: marginal cost pricing. If the waterworks was charging $500 a gallon, would your first instinct be to try to scew with their pricing power, or would you instead write long, tendentious pieces with headlines like "Why We Must Ration Water"?

Posted by: roublen | July 22, 2009 7:55 AM | Report abuse

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