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Senator Grassley, the Public Option, and Me


I should probably be proud. Sen. Chuck Grassley quoted me at today's Senate Finance mark-up hearings. He was quoting me a bit out of context, and he was actually just cribbing from the Heritage Foundation's round-up of out-of-context quotes on the public option, but still: Any publicity is good publicity and all that.

The problem is that it wasn't really accurate. The quotation came from a panel I did in Netroots Nation two years ago, where I was actually cast as the critical voice against a chorus of single-payer supporters. The argument I made, basically, was that single-payer does not have the votes, and it does not have the votes because, whatever the basic polls say, politicians do not believe their constituents will punish them for opposing single-payer.

Here is the part of my presentation that Heritage quoted: "They have a sneaky strategy, the point of which is to put in place something that over time the natural incentives within its own market will move it to single-payer.” The "they" in this sentence refers to the folks who conceived of the public option, and the "sneaky" was a joke setting up the next part of the sentence: Supporters of the public option think the market will move us towards single-payer. Socialists for capitalism!

Since the senator considers me an authority on the public option, let me lay out the argument at greater length: Liberals don't think that Congress will pass a bill outlawing private insurance. They don't think the Supreme Court will render a decision naming WellPoint "cruel and unusual." Rather, they think the market will, well, work: The public option will provide better service at better prices and people will choose it. Or, conversely, that the competition will better the private insurance industry and that people won't need to choose it.

But that confidence rests on a very simple premise: The public sector does a better job providing health-care coverage than the private sector. If that proves untrue -- and I would imagine most every conservative would confidently assume that that's untrue -- the plan will fail. The public option will not provide better coverage at better prices, and so it will not be chosen, and it will languish. Indeed, if it languishes, it will lack customers and thus lack bargaining power and economies of scale, and get worse even as the private insurers get better. In that scenario, the public option not only fails, but it discredits single-payer entirely.

The liberals are willing to bet that they're right. It's not a sneaky strategy: It's an up-front wager. The conservatives are not, however, willing to bet that they're wrong. They're willing to say the public option will fail, but not give consumers the chance to decide that for themselves.

Now who's being sneaky?

Photo credit: By Susan Walsh — Associated Press

By Ezra Klein  |  September 29, 2009; 12:23 PM ET
Categories:  Health Reform  
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Next: Lunch Break


Unfortunately, he lumped you with Heritage and Lewin, but you're right -- publicity is publicity.

Posted by: LindaB1 | September 29, 2009 12:31 PM | Report abuse

Why don't you address the real criticisms of the public option, the ones wisewon mentions here:

Why don't you also explain how the public option would "compete" with private insurance without using the strong arm of gov't to force down reimbursements, or absent that, how it would differ from a non-profit insurer.

Posted by: ab13 | September 29, 2009 12:43 PM | Report abuse

Given that the political economy governing the public plan will be the same political economy governing the runaway costs that are medicare and medicaid, isn't skepticism warranted? And can you point to a single government run institution that allowed itself to be replaced by competition?

Posted by: moziek | September 29, 2009 12:43 PM | Report abuse

Here’s the “sneaky” scenario that I think conservatives are worried about: Imagine a public option is passed to compete with private insurers. Imagine, for the sake of simplicity, that, after being driven to compete efficiently by the threat of the public option, private insurers are able to come up with a “standard” package that provides health insurance for a cost of $10,000. The public option, despite enthusiastic support from liberals and politicians, is not able to recognize the type of administrative advantages that were anticipated and can offer only a standard package at a cost of $10,100. Imagine these insurance packages are EXACTLY the same. Shouldn’t a rational individual choose the private and cheaper plan? Obviously.
But here is where I think conservatives have a legitimate fear. There is a lot of anti-insurance company political sentiment to be taken advantage of. The public plan will also come with an array of subsidies to make it easier for poorer families to afford. What would stop “liberals” (for lack of a better term) from simply tacking on an additional, across the board, $200 subsidy to the public option –a subsidy that could NOT be applied to a private plan?

Suddenly, despite being less efficient, the public option would out-compete the private options. I think this is the “sneakiness” that thinking conservatives are wary of. And I have never heard any explanation as to how this would be prevented. We live in a country where we subsidize mortgages, farming, and who knows what else – all of which is inefficient. Why wouldn’t we be tempted to subsidize an inefficient public option?

And I don’t think the lack of any rational reason to so subsidize provides any real assurance that it won’t happen. Just watch the upcoming Michael Moore movie. As a country, we are not lacking in the desire to stick it to private corporations, regardless of whether it is rational or not.

Posted by: twweaver7777 | September 29, 2009 12:45 PM | Report abuse

To expand on that just a bit: the existence of lying, disingenuous Republicans with shoddy arguments does not invalidate the arguments of the people with legitimate concerns about the public option. Refuting only the bad arguments does not get us anywhere. Stop playing tee-ball and step up to the plate for the hard questions.

Posted by: ab13 | September 29, 2009 12:48 PM | Report abuse

To me the issue has always been what happens if the "public option" becomes insolvent. As long as its allowed to fail then I have no problem with having one. I believe that its impossible for an unsubsidized public plan to both cover what liberals consider to be fair while also only charging what liberals consider to be fair. If it has to exist only on incoming premiums then to me the real issue is what happens if (when) it becomes insolvent.

Of course where a public option really has the ability to set itself above private insurance is if providers would be required to give the public plan the same rate they give medicare patients. But since thats not part of any plan that I know of currently under discussion thats a whole separate matter.

Posted by: spotatl | September 29, 2009 12:49 PM | Report abuse

"But that confidence rests on a very simple premise: The public sector does a better job providing health-care coverage than the private sector. If that proves untrue -- and I would imagine most every conservative would confidently assume that that's untrue -- the plan will fail."

Do you really believe that?! How long have you lived in this town? If a government program does a crappy job, it will fail?! No problems with subsidies, rigged rules, bailouts? The mind reels.

Posted by: ostap666 | September 29, 2009 12:57 PM | Report abuse

spotatl, those are good questions too. These are the things Ezra ought to be addressing. This whole strategy of saying "we just want a public plan to give the insurers some honest competition" while completely ignoring questions about whether the competition is really honest is really getting frustrating. I know Ezra usually reads wisewon's comments, and his was the first one in that other thread, so it's not like it was lost in the shuffle.

Posted by: ab13 | September 29, 2009 1:03 PM | Report abuse

ostap666, how very true. I can barely fathom the naivete required for someone to think "Hey, this gov't program didn't work out like we wanted, cost more than we planned and too many unintended consequences, let's just scrap the whole thing" is anything other than science fiction.

Posted by: ab13 | September 29, 2009 1:05 PM | Report abuse

actually the government does a better job at SETTING REIMBURSEMENT RATES in captive markets like Medicare. And the fact that Sen. Rockefeller's ammendment would force providers (for 2 years) to take the public option at Medicare rates is ridiculous. Do they think doctors would easily be able to opt out? And then after 2 years rates will be "negotiated". Who will negotiate it? A government offical that's who. Do they really expect us to believe provider reimbursements will go up to levels that providers can survive on so they can stop cost shifting.

Posted by: visionbrkr | September 29, 2009 1:12 PM | Report abuse

Sen. Jay Rockefeller, D-W.Va., is proposing a public plan modeled on Medicare, in which the government would set what it pays doctors, hospitals and other medical providers.

Sen. Chuck Schumer, D-N.Y., is proposing a government plan that looks more like a private insurance company and negotiates payment rates with providers.

Medicare for ALL-at tier rates!

We all wind up on Medicare anyway!

At least the years of premiums paid will go towards our policies when we need it most and it is a fact that healthcare costs are the most expensive.

Now that is INSURANCE!

Not insurance companies that take your money- rob you while they can and then drop you when you need it most!

How insane is this?

Now HSBC is selling Life Insurance

Discover Card is selling Long Term Care Insurance

Are we NUTS?

Posted by: sasha2008 | September 29, 2009 1:15 PM | Report abuse

Public Option?

I think the fear of the unknown is the greatest barrier to entry for the good of the people.

An oligopoly familiar to most people-The Airline Industry, look at the cost reduction in San Diego when Southwest Airlines- ‘a low cost carrier’ was allowed to enter that market.

In the early 90's - Chicago was home of two of the biggest carriers- American & United Airlines in the industry.

Both carriers operated out of O’Hare Airport.

Midway Airport was old- decrepit and sitting idle.

Midway Airlines operated out of Midway Airport only- but they entered the Chicago market

They lasted a few years. In the interim- Southwest Airlines overcame laws in Texas that restricted entry into an industry that already had one of the greatest BARRIERS to ENTRY in the world.

Midway Airlines " with limited destinations " eventually failed, however- Southwest flourished.

Southwest entered the market with more destinations to where they competed with United and American.

A real example- over decades American and United both offered service to business travelers approximately 3 flights per day from Chicago O’Hare Airport to Providence Rhode Island.

A round trip fare “on United or American-i.e. depart Tuesday, return Thursday, ranged between $700.00 “$900.00.

Once Southwest Airlines offered comparable service from Midway Airport to Providence, RI – offered a round trip fare of $200.00. Guess what United and American did?

United and American began to charge $199.00 for the exact itinerary they charged $900.00, pre- southwest.

Public Option into the Health Industry Oligopoly is our Southwest of the Airline Oligopoly!

Posted by: sasha2008 | September 29, 2009 1:17 PM | Report abuse


good point on ostap666's point. So I'm guessing that the Federal Government will allow medicare to go bankrupt and not raise taxes of some sort to pay for its survival?

Posted by: visionbrkr | September 29, 2009 1:18 PM | Report abuse

Once again- If democrats really do think that corporate greed is the reason that insurance premiums are so high then I am all for giving them a few billion dollars to start up their own insurance company. Call it the public plan or call it a co-op. But once that initial funding is passed over then the plan needs to be unsubsidized and exist completely on incoming premiums. If they really can make the numbers work by covering everything they consider to be fair while only charging what they consider to be fair then that would be spectacular. Because I believe that we have a costs problem in this country and not an insurance company I think the grand experiment would quickly become insolvent and at that point the federal government should not bail the public plan out because that would just be the same thing as a subsidized plan.

I simply do not understand why people think that the current public plans under discussion would have any significant cost savings at all. If you want to make providers accept the same rates for public plan patients as they give to medicare patients then that has cost savings- but in reality thats just an accounting trick to let people buy into medicare. If you want people to be able to buy into medicare then just go ahead and pass that legislation!

Posted by: spotatl | September 29, 2009 1:20 PM | Report abuse


I'm sorry but the one problem with your argument is that Southwest Airlines isn't run by the government. Otherwise you make complete sense.

And we don't need a public option if medical loss ratios are in place at responsible levels of 85%. What we need is a way to get utilization down without harming outcomes. Then costs will be forced down via the MLR without government intrusion.

Posted by: visionbrkr | September 29, 2009 1:22 PM | Report abuse

Sneaky implies a meanness and cowardice which isn't what Single-Payer supporters are about. Single-Payer is a superior product which would save taxpayers hundreds of billions a year without harming patient care. The Public Option is none of this, and in fact is so broadly defined that no one can say what it is or what it will do.

Posted by: bmull | September 29, 2009 1:24 PM | Report abuse

I do believe in free markets and I'm all for a "public option" that receives no funding resulting in any way from my tax payments, pays its executives minimum wage, does no advertising, pays its investors nothing, is available to everyone regardless of age and physical condition, and offers at a competitive price the same or better care than does its for-profit counterparts.

Sadly, proposed "public options" call instead for taxes on everyone to pay for freeloaders.

Posted by: rmgregory | September 29, 2009 1:32 PM | Report abuse

You write, "In that scenario, the public option not only fails, but it discredits single-payer entirely." If only it were that simple. When we have evidence that any number of poorly run government programs have been, are ,or will be bailed out, why would you believe that the public option would ever be allowed to fail?

Fannie, Freddie, the post office, Amtrak, Medicare -- all have failed and been bailed out. This is a legitimate concern. And since whatever this Congress does can always be over-ridden by a future Congress, Dems can't make a credible commitment to letting the public option fail.

Posted by: mbp3 | September 29, 2009 1:34 PM | Report abuse

"we don't need a public option if medical loss ratios are in place at responsible levels of 85%"

I can't speak for recent years, but Kaiser Permanente's MLR was traditionally "set" at 95%. That's right we SET it at 95%. I used to work there so I know. It was a made up number. If our profit was higher than expected we paid our medical staff a bonus, thereby bringing down the MLR. Get over it already.

Posted by: bmull | September 29, 2009 1:35 PM | Report abuse

Lets go with medicare for all. NO ceo multimillion dollar salaries, no wasteful advertising, no administrative duplication of competing insurance company forms, no multimillion dollar payments to lobbying firms, cost curve bending by forcing providers to curb their rates. What is not to like? Somehow, I don't see bunches of doctors forced out of work and on welfare because of underpayments by medicare.

Posted by: srw3 | September 29, 2009 1:53 PM | Report abuse

srw3, that is because they make up for the underpayment by overcharging private insureds. Once the subsidizer is no longer around the subsidizee has to start paying their fair share. As for this bit of humor, "cost curve bending by forcing providers to curb their rates", how has that worked out for Medicare so far?

Posted by: ab13 | September 29, 2009 2:00 PM | Report abuse

The chief problem with the public option, tied to Medicare rates, is that it underpays hospitals and other care providers. In the short term, private insurance makes up the difference for the losses care provider make on public insurance, just like is the case currently with Medicare, but in the long term, as the underpaying public option, with corresponding and artificially depressed premia, drives private insurers (unfairly) out of the market, no one will be there to make up for the difference caused by public-insurer underpayment, and the entire system collapses and there are no private insurers left for people to turn to.

That is very much a sneaky scenario of single-payer by the back door, and I say SHAME on Ezra for not addressing this legitimate concern and serious question.


Posted by: jvriebeeck | September 29, 2009 2:31 PM | Report abuse

Your logic in this is stunningly bad. You are allowing the public option to be a stand-in for single payer, the reputation of which you are hanging on the very different public option. There is a huge difference between a self-funding COMPETITOR modeled on private insurance companies and supposedly on equal footing with them and a single-payer system which delivers a mandated insurance package with tax subsidies assumed and system-wide menu-style pricing that simplifies billing.

I'm surprised that you have ignored the efficiency part of a single-payer where rates are set system-wide reducing overhead in medical offices and hospitals. The efficiency of single-payer is not only and not largely INTERNAL TO the insurer but EXTERNAL to the insurer in the health care system as a whole.

I'm afraid you are allowing your own political positioning and calculations to get in the way of your judgment on what is good and not good policy. You want to differentiate yourself from those "naive" single-payer advocates at any cost and in so doing your thinking suffers.

Posted by: michaelterra | September 29, 2009 2:35 PM | Report abuse

It seems worth pointing out that all of the slippery-slope concerns of the conservative commentators could be addressed easily in the legislation in exchange for support for the bill.

Posted by: JEinATL | September 29, 2009 3:10 PM | Report abuse


I don't get your point: Why should a public option have to pay its executives market rates, buy advertising, or pay its investors? The fact that a public option would not have to spend much on things like executive salaries or earn a profit to reward shareholders is an argument in its FAVOR.

Posted by: PeterH1 | September 29, 2009 3:23 PM | Report abuse

I apologize, Ezra, I re-read the piece and I think I see that you are quoting what conservatives think will happen upon the failure of the public option.

However, the whole public option issue is a distraction from real health care reform which involves either regulating insurers out the wazoo (all-payer) or public delivery of basic health care insurance (single-payer). It encourages the kind of convoluted thinking that is displayed by the liberal-conservative tug of war around the public option upon which it is difficult to report.

Please accept my apology about the misattribution to you of this logic.

Posted by: michaelterra | September 29, 2009 3:24 PM | Report abuse

Wow, Ezra thinks that the public option would be allowed to fail if it is proven to be a failure. Where in the wide wide world of federal government has a failing agency or program ever been allowed to disappear? I suspect you know the answer, despite your well-documented naivete.

Posted by: novalfter | September 29, 2009 3:39 PM | Report abuse

The anti-public option comments on this thread are so ridiculously one-sided that it must be a whole roll of private insurance astroturfers.

It's very odd that the anti-public option people, knowing full well that everyone MUST be covered and so therefore that taxpayer money WILL be involved, don't mention that under their preferences, the taxpayer money will go to the private insurers, supporting their profits and so spending more taxpayer money than the public option would need.

It's very odd that the anti-public option people wouldn't notice that we just BAILED OUT all the private insurance companies and everybody else on Wall Street by supporting the credit markets.

It's very odd that the anti-public option people wouldn't notice that SUBSIDIES go to the highway system, the airports, ocean shipping, and indeed the oil industry, in amounts that simply BEGGAR what Amtrak gets.

It's very odd that the anti-public option people wouldn't notice that the private insurers will set about to capture the regulatory apparatus as soon as ANY reform is passed, and we read ONLY complaints that the public option will be receive further government favors.

It's very odd that the anti-public option people wouldn't notice that the private insurers are a partially price-fixing oligopoly; that Adam Smith wrote that "People of the same trade seldom meet together even for merriment and diversion, but the conversation ends in a conspiracy against the public or some contrivance to raise prices;" that the private insurers are attempting to hide the immorality of coverage denial and rescission behind the canard of competition for profits; and that they can never be trusted.

Posted by: Lee_A_Arnold | September 29, 2009 3:40 PM | Report abuse

JEinATL- how could the bill be written so that the public plan would be allowed to fail if it becomes insolved and not bailed out? Because thats the crux of it to me- if democrats really thing that that they only need a 1 time small amount of cash to get this started up and they don't need to piggy back off of the scale of medicare in order to force provider compensation lower then I am 100% in favor of that. But I don't at all see how the legislation could be written so the public plan would ever be allowed to fail. Thats why semantically I'd prefer to see it called a co-op- just because then I think it would be more likely that it woudl be allowed to fail.

Posted by: spotatl | September 29, 2009 3:44 PM | Report abuse

Not to mention, of course, the existence of lying, disingenuous Independents and Democrats with their shoddy arguments.

Posted by: iowavette | September 29, 2009 4:07 PM | Report abuse

The comments are one sided because these are the questions I keep asking about the public option and no one ever wants to talk about the ugly warts all over the bills currently being discussed. People want to talk about how much better single payer or medicare for all would be but those are not the bills under discussion. They want to discuss how great a subsidized public plan that can pool together with medicare would be but that is not in the bills under discussion. The current bills have a TON of problems that many people seem to want to stick their heads in teh sand about.

I know you believe that anyone who would oppose the lousy bills currently under discussion MUST be astroturfers- instead we are just people who have concerns about the direction this thing is going in.

And I'll even say that the reasonable opposition to the current bills probably has little to do with what a lot of republicans are currently trying to hammer the democrats on. These are just the concerns that I have.

Posted by: spotatl | September 29, 2009 4:08 PM | Report abuse

"The conservatives are not, however, willing to bet that they're wrong." - Ezra.

Smart people don't play childish betting games.

Can you - Ezra - name one Government program that has worked Efficiently and within budgets, EVER?
We, the conservatives, use such Historical precedents to predict whether new Government program will be yet another boondoggle or not.

I am sure you are capable of understanding how a Public Option can hurt the private Insurance industry, and it has been explained numerous times before. I am going to make one more attempt:

A private Insurer is a for-profit entity, beholden to the share holders. By forcing them to provide numerous preventive procedures and test, and forcing them to cover the pre-existing conditions, Government is turning them into money losing enterprise (unless they raise the premiums). Raise the premiums and instantly you are not competitive anymore. Don't know how long such a business can stay open.

On the other hand, Congress, with its power of incumbency, is accountable to none. They are free to spend tax payers' money. If that's not enough, they print them. Very easy for them to provide coverage to all the uninsured people and without regard to pre-existing conditions.

If a Public Option plan is forced to provide the identical benefits as the Private plans and the budgeting is strictly enforced to break even every fiscal year, then and then it would be truly competitive.
What are the chances of that happening?

Posted by: vatodio | September 29, 2009 4:09 PM | Report abuse

I don't understand the folks who oppose the public option because they think it will fail and continue to be subsidized. The track record is that the more successful government care is with limited resources, the more Congress tries to starve the system and divert patients to the private sector. A public *option* would never be allowed to succeed.

That's why we need a national public plan with private options. I would much rather send my money off to a public, non-profit fund (a la France or Germany) than be strong-armed into subsizing private plans.

The US government spends at least 46% (some say 51%) of every dollar being spent on health care in the United States today. Why shouldn't people expect it to use that power to negotiate drug prices? Why shouldn't they have the same access to care that citizens in every other industrialized country do?

Posted by: Athena_news | September 29, 2009 4:12 PM | Report abuse

"The track record is that the more successful government care is with limited resources, the more Congress tries to starve the system and divert patients to the private sector"

Uhhh... care to elaborate on this statement? When has Congress ever shown the backbone to pass even reasonable cost saving measures for medicare? I think that our political system is completely incapable of holding down costs because no politicians have reason to take a stand against rising costs.

Covering just 15% of the population is going to bankrupt the country yet you think that expanding goverment run healthcare to cover more voters will make politicians more fiscally responsible in this area?

Posted by: spotatl | September 29, 2009 4:21 PM | Report abuse

"The conservatives are not, however, willing to bet that they're wrong."

Some of the moderates, conservatives, and libertarians that oppose the public plan are not willing to bet that the public option would ever truly "compete" on an equal basis.

You are extraordinarily naive if you are not aware of the many ways in which a government agency can (a) pretend costs are lower than they really are, by cost-shifting to other government agencies and to its own private competitors; (b) misprice any service and underestimate any risk; and (c) make sure that there are constraints on private plans that are not constraints for public plans.

For just one example, today Florida has a 'public option' for property insurance. It has "competed" with private insurance -- in fact, has driven several firms out of Florida entirely -- simply by writing more policies than its capitalization can possibly support, at lower prices than any actuary could possibly approve.

Since it's state-run, this state of affairs will probably last there until the next really big hurricane, at which point every taxpayer in Florida will be called upon to rescue it to the tune of thousands of dollars per taxpayer.

And you wonder why some people don't see the value of public options "competing" with private companies...

Posted by: enoriverbend | September 29, 2009 5:08 PM | Report abuse

Spotatl, it looks like there is Medicare cost control in THIS bill. Talk about all the warts. You appear to admit no tradeoffs into the discussion other than your own. The taxpayer is on the hook, unless you are against the mandate too. The mandate requires that those who can't afford it be picked up by the taxpayer. But with NO strong public option, the taxpayer money goes to the private insurers -- in fact the taxpayer will pay an additional amount over the public tab, into the private profit structure. The Republicans against the strong public option are in favor of making everyone who can afford it, pay money into a private profit company -- and they are in favor of spending more than necessary of taxpayer money, for those who can't afford it.

Posted by: Lee_A_Arnold | September 29, 2009 6:51 PM | Report abuse


You say : The public option will not provide better coverage at better prices, and so it will not be chosen, and it will languish.

Well in MY experience as it starts to languish, the people who WANT it to succeed will change the laws to in essence REQUIRING people to join.

You can't do that? Puh-lease!

Let's see ... Public Option is tax-deductible private Options are TAXED.

One lowers your tax rate and the other raises it.

And telling me that this won't happen WOULD be lying.

Let's face it.
Liberals and conservatives.
NEITHER of us trust the government.
We just disagree on what the government can and can NOT be trusted with.

Posted by: chromenhawk | September 29, 2009 7:33 PM | Report abuse

"He was quoting me a bit out of context"
LOL. Cruel irony, huh?

"Liberals don't think that Congress will pass a bill outlawing private insurance."
Conservatives don't think so, either. Since that's not our point, Ezra, what exactly is yours?

"[Liberals] think the market will, well, work"
Except, of course for Barney Frank and others who've identified the public option as tha path to single-payer, huh?

"that confidence rests on a very simple premise: The public sector does a better job providing health-care coverage than the private sector."
Um, no, the operative premise here is that government does not have to turn a profit to stay in business.

"The liberals are willing to bet that they're right."
But never EVER unless it's at someone else's expense, and at someone else's risk.

"They're willing to say the public option will fail, but not give consumers the chance to decide that for themselves."
...or it could be that Republicans, and a big, big chunk of blue dog Democrats, recognize the importance of the industry that provides the best healthcare received by the general population of any country in the world.

Posted by: whoisjohngaltcom | September 29, 2009 9:09 PM | Report abuse

You can't trust anybody who wears two pairs of glasses simultaneously.

Posted by: pj_camp | September 30, 2009 8:45 AM | Report abuse

Hey Ezra-
I wrote the "the Heritage Foundation's round-up of out-of-context quotes on the public option" that you claim "wasn't really accurate."

Please do tell me what part of your quote, or Barney Frank's, or Jan Schakowsky's, or Paul Krugman's that was inaccurate and I'll make a correction.

The only thing inaccurate here is your description of what conservatives believe. You write: "The conservatives are not, however, willing to bet that they're wrong. They're willing to say the public option will fail, but not give consumers the chance to decide that for themselves."

No conservative believes a public option would ever fail. Conservatives fear the exact opposite: That once passed, a public option will "succeed" at all costs. Not through "competition" but through endless bailouts and favorable regulations from Congress and the new health czar.

If the public option does pass, here is a bet I and every other conservative on the planet are definitely ready to make: the public plan will not be self-sustaining and Congress will have to subsidize it beyond the premiums it takes in and through other favorable tax breaks and regulations.

Are you willing to take that bet?

Posted by: conn_carroll | September 30, 2009 9:09 AM | Report abuse

As the future rolls towards us, American taxpayers, streched to the limits by high taxes, begin to use the freedom of information act to determine the real value of their public employees. Public employees, salaries, benefits paid for by hardworking american taxpayers, will soon begin the process of being downsized.

Posted by: stanman1 | September 30, 2009 9:36 AM | Report abuse

Ezra, allow me to elaborate on why us conservatives would not like to "bet" that the public plan would fail.

In short, the government would not acknowledge the failure of a government program and terminate it.

Others have cited examples of government 'competitors' that lose but are in no danger of elimination - Amtrak, the USPS, Fannie Mae, etc.

So where is YOUR example of a government-sponsored competitor that failed, and was eliminated as a result?

You see, the "bet" is phony, as there is no way conservative "gamblers" could "collect."

Posted by: angrydoug1 | September 30, 2009 9:54 AM | Report abuse


Do you really think the public option will be allowed to fail? How many other government programs that fail to meet expectations are shut down rather than propped up?

Posted by: agbiggs | September 30, 2009 11:23 AM | Report abuse

There are legitimate objections to be made against a public option (even though I don't necessarily agree with them), but I think Ezra's conservative critics are having it both ways here. I don't see how it is possible for the public option to simultaneously (a) use its inherent advantadges as a government-run program to crowd out private insurers AND (b) be so inefficient that it needs a bail-out from the federal government. One or the other could happen, but not both.

Posted by: PeterH1 | September 30, 2009 11:55 AM | Report abuse

As we point out here

Klein is wrong about the context and has now directly contradicted his prior statements (in June) about this same video clip.

Perhaps someone at the Post is paying attention?

Posted by: captainhendry | September 30, 2009 12:31 PM | Report abuse


I've been reading Ezra's blog for years, and I've always understood his point that a public option could evolve into a single-payer system through its superior bargaining power & lower administrative expenses. One may disagree with the logic, but there is nothing dishonest about it. I've read your post, and the only thing you prove is what a jerk you are.

But go ahead and complain to the ombudsman, if that's what makes you feel good.

Posted by: PeterH1 | September 30, 2009 1:30 PM | Report abuse

I've been making a similar argument. The economics that support a single-payer system are quite simple: single-payer achieves the biggest risk pool, which allows it to provide the best coverage at the lowest premiums. But again, whether or not a public option leads to the creation of a single-payer system doesn't matter - if the market works as well as conservatives say it does, whichever option we end up with will be the best. If private companies can't provide the best service at the lowest cost, they don't deserve to be in business.

Posted by: akent07 | September 30, 2009 3:38 PM | Report abuse

"Others have cited examples of government 'competitors' that lose but are in no danger of elimination - Amtrak, the USPS, Fannie Mae, etc."

None of those examples are convincing.

Amtrak was formed because private railroads couldn't make a profit on passenger service, and wanted to get out of the business. Amtrak wasn't a "government sponsored competitor" because no one wanted to compete in the passenger rail market.

The USPS is of course in no danger of elimination because the government has always had a legal monopoly on first class mail. USPS rates are set based on cost; it doesn't cross-subsidize one service with another. So to the extent that the Postal Service's market share is nonzero in areas where it competes, it can't be said to have failed.

Fannie Mae was treated pretty much like any other financial firm in the recent financial crisis.

"So where is YOUR example of a government-sponsored competitor that failed, and was eliminated as a result?"

The Pony Express was eliminated when telegraph service made it most of the way across the continent.

Posted by: KennethAlmquist | September 30, 2009 5:41 PM | Report abuse


Klein's work at the Post only dates back to May of this year. Can you point out a post during that time where he says the public option could "evolve into a single-payer system"? I can point out one where he states definitively that it won't.

I'm aware Klein has stated previously that the public option was a strategy (not just in the video). The problem is that this summer, while the the country was actually considering the public option, he hasn't been so inclined. On the contrary, he denied it and mocked the very idea as "The Underpants Gnomes Theory of Single-Payer." Only, as he admitted yesterday, that wasn't true.

I guess if you're really keen on reading someone who isn't straight with his own readers, there's nothing I can say that will change your mind.

Posted by: captainhendry | September 30, 2009 7:16 PM | Report abuse

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