California’s fiscal suicide.
Listen To You Tell Me Texas Friday 4/28/17
As GOP House members confront the difficult and politically dangerous task of dismantling Obamacare – a process that is more and more attributable to the fact that Obamacare is collapsing – the state of California is now considering a statewide single-payer health care system.
It’s all in Senate Bill 562, called the “Healthy California Act” (and who doesn’t want a healthy California?). If passed, it would entirely replace private insurance in California with a single-payer government health insurance system. That system would cover all 38 million of California’s citizens – as well as its however-many million undocumented aliens.
To any objective observer – objective being defined as anyone willing to do 6th grade math – the bill is nothing less than an act of state suicide. California is already in deep financial trouble. The state is carrying a massive debt – the highest of all 50 states – as well as unfunded public pension liabilities that approach $1 trillion by some estimates.
There is no way that California can afford universal health care even if it was a good idea, which it’s not. The necessary taxes will only hasten departures from the state by both businesses and individuals. California cannot afford any such exodus (or put more correctly, any more such exodus). Each taxpayer that departs leaves his or her portion of the state’s current and future obligations to be covered by those left behind; who, thus saddled, begin weighing up the idea of departing themselves. It’s a fiscal death spiral.
All of this aside from the fact that the people in California most touted as likely to benefit from universal health care will be the ones most unhappy with it if it ever comes.
Certainly Jennifer Aniston and Tom Hanks and Barbra Streisand – any or all of whom can likely be counted on to appear in the TV commercials in favor of SB 562 – will be the least affected. Our favorite rich, liberal Californians will go right on seeing the very best doctors and getting the very best attention and care because they can easily afford to pay the bills.
But everyone else – from the merely wealthy to the upper middle class and all the way down to the very poorest in the state – will find themselves waiting weeks and months for care that was once available on demand. When the state becomes the payer, meaning when consumers stop having to reach for their wallets even to pay a portion of an insurance premium, demand for services will immediately outstrip supply with no chance of ever regaining market equilibrium.
Californians will then discover what observant Brits have known for decades. No matter how much public money you spend on health care, it is never enough. Anyone willing to see it will discover – again – that to the degree that something is important to you, you want the government far, far away from it.
And we’ll all have to watch California – once envied as the wealthiest, most successful and most vibrant state in the union – sink into fiscal oblivion.