The health care costs budget fallacy
Today's report is this:
The financial outlook for Medicare and Social Security
has significantly worsened, as the bad economy and mounting job losses
have pushed both programs years closer to insolvency, according to a
grim report issued Tuesday by the Obama administration.
Maybe you once argued that "Social Security is fine," but dollars are fungible and the budget must be judged as a whole. The consumption tax is coming, I am sorry to say.
I'm seeing nascent signs of a new (but actually old) fallacy, namely that since health care costs can (will?) crush the budget, we don't have to worry so much about other expenditures. The mental story runs something like this: "if we don't cure health care cost inflation, it doesn't matter; if we do cure health care cost inflation, we can afford it." That's exactly the kind of false mental framing that behavioral economics identifies as irrational in other settings.
Here is some stupid TV.
Elsewhere, Richard Posner makes many concessions. I do not disagree; it's a mistake to think that a political movement can be very smart, especially after extended years in power.