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The Economist-in-Chief


Some wags have labeled President Obama's performance last night as the "professor-in-chief." "If I really like a politician’s speech," wondered Paul Krugman, "isn’t that an indication that he lacks the popular touch?"

Krugman was closer than he knew. Obama wasn't just the professor-in-chief. He was the economist-in-chief. He used words like "incentivize" and talked about the need for patients to be more "discriminating consumers." He talked about the way that fee-for-service encourages overtreatment and the dangers that health-care costs pose to our debt. And then there was this section:

[I]f somebody told you that there is a plan out there that is guaranteed to double your health care costs over the next 10 years, that's guaranteed to result in more Americans losing their health care, and that is by far the biggest contributor to our federal deficit, I think most people would be opposed to that.

Well, that's status quo. That's what we have right now.

So if we don't change, we can't expect a different result. And that's why I think this is so important, not only for those families out there who are struggling, and who need some protection from abuses in the insurance industry, or need some protection from skyrocketing costs, but it's also important for our economy.

And, by the way, it's important for a family's wages and incomes. One of the things that doesn't get talked about is the fact that, when premiums are going up and the cost to employers are going up, that's money that could be going into people's wages and incomes.

And over the last decade, we basically saw middle-class families, their income and wages flat-lined. Part of the reason is because health care costs are gobbling that up.

The first two paragraphs are almost a direct lift from the column that Steven Pearlstein, The Washington Post's economics columnist, wrote yesterday. The last two paragraph are almost a direct lift from the column that David Leonhardt, the New York Times economics columnist, wrote yesterday. The White House is, at the moment, interested in a very particular kind of argument for health-care reform, and that argument is being found in the business section, rather than the op-ed page, of newspapers.

This isn't necessarily a surprise. A hefty group of the participants in the White House's health-care meetings are economists. Peter Orszag, of course. Jason Furman. Jared Bernstein. Larry Summers. I even hear reports of Christina Romer and Tim Geithner having an occasional say. And many of the health-care wonks involved in the process -- Zeke Emanuel comes to mind -- have something of the economist's approach to this issue as well. That might be why Obama did an interview with Fred Hiatt yesterday entirely focused on the relationship between health-care reform and fiscal responsibility. That's the critique that's stinging him.

But the end result is that Obama talks about this more like someone worried about health-care costs than about health care. As a matter of policy, that's probably the right approach. But as a style for conducting press conferences, I'm not sure how well it works. Obama is making a big bet on the policy case for health-care reform, as opposed to the moral urgency of health-care reform. It's a macro argument rather than a micro argument. And Obama makes it well. The question, which I don't think anyone knows the answer to yet, is whether it's the right argument.

Photo credit: J. Scott Applewhite -- Associated Press Photo .

By Ezra Klein  |  July 23, 2009; 10:35 AM ET
Categories:  Health Reform  
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I think that the pundits are right. He's everything that people envision most professors to be: smart, overly-wonky, and out of touch with the most basic operation of what he's talking about. It's one thing to always talk macro, but his micro talk--red pill, blue pill, how a decision to perform a tonsillectomy is made--rings absolutely false. The public think of professors as part of the "those that can't do, teach" camp. That's not flattering.

If he, Orszag, or anyone else connected with reform actually talked about real, concrete 'game-changers' or cost-savers, then people would pay attention. They're not because those things are unpleasant--rationing, no pacemakers for 99-year olds, etc. Until then, Obama keeps talking in abstractions that don't relate to normal people or business owners' concerns...just like a professor would.

Posted by: Philly213 | July 23, 2009 10:43 AM | Report abuse

during the conference, when president obama was asked why he was pressing for a deadine for health care passage, he spent quite a lot of time talking about the moral urgency of reform.
he spoke about letters that he reads each day relating personal tragedies resulting from struggles with obtaining and paying for health care.
barack obama has spoken many times about his mother's struggle with health care at the end of her life. i think he is very sensitive to the moral urgency of this.
i cant imagine that barack obama eats dinner everynight with michelle, who spends her days in public schools in washington, dc, his mother-in-law, whose husband suffered and worked each day with debilitating illness, and his two daughters, and doesnt think about the personal struggles of everyday americans.
so much attention is now focused on the economics of reform, that i think he was trying to address that also, last night.
i think that it is admirable that when president obama holds a press conference, he assumes that the american people are capable of understanding something beyond platitudes.
it seems that he is trying to make every argument possible, and i give him credit for that.

Posted by: jkaren | July 23, 2009 10:50 AM | Report abuse

finally, after so many years, we have a president who will talk about facts, and not just read heartrending letters from americans he met on the campaign trail as filler, because he cant fathom or convey complex information to the american people.
and i will say that anyone living in the same house with michelle obama and marion robinson, will not be likely to forget the moral urgency of health care for all americans.
he is surrounded and grounded in his personal life with people who stay real, and do not forget the hardships of americans, especially the poor.

Posted by: jkaren | July 23, 2009 10:59 AM | Report abuse

You'd have to think that he's making the right choice making a "policy case for health-care reform, as opposed to the moral urgency of health-care reform". People have been trying the moral case since the forties to no avail. That's probably because we (the majority insured, no doubt) still get good care. Maybe not the best, but how many of us would be able to tell the difference? And given The Great Recession, economics is on everyone's mind, whether they understand it or not. He's made the right choice, it's just a question of whether he can convince everyone else.

Posted by: murtha11 | July 23, 2009 11:00 AM | Report abuse

I think he's talking about costs rather than the "moral" component because that's where the action is now.

Everyone who's gonna be swayed by a moral argument for health care is already swayed. Even Republians give lip-service to "we must do SOMETHING". Everyone- especially the fence-sitters- are only worried about costs (indeed, for a family that already has insurance, costs is the primary way this will affect them). So you go where you're needed.

That being said, he did, repeatedly, cast it in human terms, and quite effectively. So the "moral" case wasn't absent. It just wasn't the focus, and I don't think it needed to be.

Posted by: colby1983 | July 23, 2009 11:03 AM | Report abuse

"I think that the pundits are right."

This really should be a big warning sign that your thinking on the issue is all bollixed up. :)

Posted by: colby1983 | July 23, 2009 11:05 AM | Report abuse

"Obama talks about this more like someone worried about health-care costs than about health care."
"Obama is making a big bet on the policy case for health-care reform, as opposed to the moral urgency of health-care reform. It's a macro argument rather than a micro argument."

Ezra sums it up precisely. While this is a different kind of analytical framework that is usually made, it rings true that the Obama approach comes across in an unemotional, bloodless kind of way.

It is the kind of argument that you'd expect from the almost non-existent responsible conservative (GOP flavor). It is not the kind of argument that one expects from a liberal/progressive concerned about the moral imperative to ensure everyone's health is enhanced and problems get addressed as a matter of human rights and shared responsibility.

It boils down to saying we can't afford the status quo. That kind of argument could be the basis for saying Medicare and Medicaid is beyond our ability to pay for it, or that people should assume responsibility for their own healthcare payment because society hasn't the means to pay for it. It is cold, heartless and the epitome of 'root, hog, or die' economics.

Put another way: the basis of the argument is budgetary, not social responsibility.

I know that his comments at the presser indicate he's aware and concerned about the moral arguments, but that concern is far far too calculating as received by the citizen as a message.

Posted by: JimPortlandOR | July 23, 2009 11:06 AM | Report abuse

The cost of health care is truly the issue we face today. Because of the astronomical rise in premiums, businesses are strangled by the cost of providing care to their employees.

Because of costs, many people cannot afford health care at all.

Because of costs, people like me spend a ton of money for sub-standard insurance - leaving us with less disposable income for other areas - and leaving us really exposed financially, should we be hit with a health care crisis.

Because of how insurance "groups" people together, smaller organizations and individual families often find themselves priced out of insurance.

Because insurance companies pay for tests and not service, we have a bloated and inefficient system, where docs make more money ordering tests than chatting with a patient on the phone.

The cost of health care is the reason why health care is in need of reform as it is today.

Posted by: anne3 | July 23, 2009 11:07 AM | Report abuse

I think it's the right argument to sell it to most people b/c most people have health insurance. Therefore most people want to know how this is going to affect them. Meaning money. Moral urgency is how we like to think we define ourselves, but at the end of the day the issue for most is the pocketbook.

Posted by: rldestef | July 23, 2009 11:07 AM | Report abuse

I agree with the commenter above. 85% of us have health insurance, so it is pretty hard to get most people ginned up about the moral urgency of health care reform because that question always leads back to focusing on the uninsured (as it should, but it won't tug on the heartstrings of a lot of people in America). Health care costs are something that affect everyone and, thus, are a much more politically potent target.

Posted by: smhjr1 | July 23, 2009 11:15 AM | Report abuse

The moral argument has been made largely in the electoral campaign. And is still being made. Those who need to be won over are those still employed, who think "I've got mine so I don't care."

Beyond economics its an argument for health care security. In the U.S. citizens 65 and older, politicians, military, disabled, govt. workers, have an entitlement for health care. The citizens who pay this have no entitlement. They are, and should feel, very insecure, and a sense of injustice, that they are required to pay for the public option for the entire elderly population and for the very politicians who want to deny them a health care entitlement. I have a sister in law in her 50s, single, who is going to lose her health care and cancer treatment because she is too ill to work. She's been paying all her life for Mitch McConnell and his ilk to have a cadillac health care plan, but she is supposed to die quietly because she doesn't have Mitch McConnell's entitlement to health care.

Posted by: cmpnwtr | July 23, 2009 11:16 AM | Report abuse

And here I was being all bipartisan: Krugman is now a "wag" whose thinking is bollixed? I think I must have stumbled onto the wrong blog!

Posted by: Philly213 | July 23, 2009 11:43 AM | Report abuse

There is No moral urgency of health-care reform! None!

Posted by: obrier2 | July 23, 2009 11:47 AM | Report abuse

"And here I was being all bipartisan: Krugman is now a "wag" whose thinking is bollixed?"

Well, it was 9/10ths a joke. As for the other 1/10th, its based on the fact that when the pundits try to game out the "political" implications of the President's demeanor, they usually do get it wrong (Krugman especially- though I actually doubt he WAS giving an honest assessment of political consequences here, so much as a self-deprecating joke). For example, this "professorial" tag has been on Obama since the early (as in, pre-Iowa) primaries, and it hasn't really meant anything. And anyway, I said YOUR thinking was bollixed, not Krugman's. ;)

Okay, so it's actually 19/20ths a joke. But who's counting?

Posted by: colby1983 | July 23, 2009 12:22 PM | Report abuse

I think I'm going to use Krugman logic and call it propaganda since I don't agree with it.

I know big words are impressive after Bush but that doesn't resolve the issue of logic. If only we had a leader that could speak and think.

Posted by: fallsmeadjc | July 23, 2009 12:31 PM | Report abuse

Praise Obama!!!

Did you watch the whole thing on your knees?

Posted by: fallsmeadjc | July 23, 2009 12:33 PM | Report abuse

Oh, cool, the "Obama is Messiah" thing again. That's a useful contribution, as well as a demonstrated political winner..

Posted by: colby1983 | July 23, 2009 12:48 PM | Report abuse

last night, i was driving on I95 south of philly with some smart, liberal (i'm guessing, but pretty sure) colleagues. as we passed through chester, someone brought up how poor and sad that city is. i mentioned a friend of mine who did a lot of work helping to convince poor chester residents to move to city water over using well water because the incidence of lead poisoning among kids in chester is outrageously high due to lead in the well water that so many households rely on.

the response from my colleagues immediately turned to the high costs to society for treating kids with lead poisoning, and it struck me as part of this same trend. I assume they meant 'obviously, we have a moral responsibility to help people get access to clean water, but it's interesting to think about the financial implications as well.' but that part just gets skipped over. like, if families were paying the full cost of having brain damaged kids, that would be fine. as long as "society" doesn't have to pay for it. while i respect the pragmatic reasons for obama's using that reasoning, i wish it weren't necessary. it would be better if we didn't live in a society that treats any economic argument as somehow more serious than all other kinds of considerations.

Posted by: MoMonroe | July 23, 2009 3:00 PM | Report abuse

I don't think the financial argument in the end is even a good idea from the point of view of selling this package to the already insured. The fundamental argument for the public option is that government will be committed to the task of financing health care in a way that calls upon some kind of duty to the insureds rather than profit. Yes, Obama tries to dress it up as a financial argument but the same could be said for a system of heavy regulation of for-profit entities like they have in the Netherlands or Switzerland. If you believe that government SHOULD be involved in the delivery of health care finance, you believe that a non-profit government entity somehow is more appropriate or at least has advantages over a for-profit entity.

My fear is that Obama has straddled the two existing approaches to health insurance finance/regulation as a political move rather than thought through how the system will actually work. I think he has the choice of heavy regulation of insurers and plans (a mandatory basic plan) or direct delivery of funds, a.k.a. single payer.

Posted by: michaelterra | July 23, 2009 3:54 PM | Report abuse

If you think political speech from either Party is intellectual then you are a hack. Political speech by definition is not objective and not intellectual.

You may be even less objective than a Fox News reporter.

Posted by: fallsmeadjc | July 23, 2009 4:30 PM | Report abuse

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