Obamacare, Hands Off My Medicare
By Thomas B. Edsall
The New York Times, April 22, 2015
A number of factors underpin the anti-redistributionist shift in public opinion that I wrote about last week.
First, and perhaps most important, is the emergence of significant resistance to downward redistribution among the elderly, a major voting bloc.
The views of older voters deserve scrutiny. They “worry that redistribution will come at their expense, in particular via cuts to Medicare,” Vivekinan Ashok, a Ph.D. candidate in political science at Yale; Ilyana Kuziemko, a professor of economics at Princeton; and Ebonya Washington, a professor of economics at Yale, write in a March 2015 Brookings Institution essay, “Support for Redistribution in an Age of Rising Inequality”— an essay my Times colleague Neil Irwin also discussed in a recent column that asked why Americans don’t want to soak the rich.
In the end, Ashok, Kuziemko and Washington conclude that “the elderly have grown increasingly opposed to government provision of health insurance and that controlling for this tendency explains roughly half of their declining relative support of redistribution.”
What the Brookings essay neglects to explore are the material circumstances of over-65 voters that might affect their views on redistribution. Over a third of retirees depend on Social Security for 90 percent or more of their annual income, according to the Social Security Administration. In the zero-sum competition for federal dollars, the cost of major spending programs like the Affordable Care Act has to be made up by spending cuts elsewhere.
The Obama administration has reported that the Affordable Care Act will be financed in part by $716 billion in Medicare cuts over 10 years. Somewhat improbably, the administration also contends that cuts of this magnitude will not reduce services to Medicare beneficiaries.
The decline in support among the elderly in the United States for redistributive social spending stands in contrast to Britain, Germany, Sweden and Australia where Ashok, Kuziemko and Washington found that older people were more supportive of redistribution than those of working age. In most European countries, health care is guaranteed regardless of age, while in the United States, before the enactment of the Affordable Care Act in 2010, only the elderly were guaranteed health coverage through Medicare.
This lends support to the authors’ conclusion that “seniors, a group unique in having guaranteed health insurance during our sample period, may increasingly feel that expansions of redistributive programs could come at their expense.”
Further increasing anxiety among the aged in the United States is the shift from defined benefit pensions, which guarantee payments, to defined contribution pensions, which do not.
“Our best assessment is that retirees are falling short and will fall increasingly short over time,” Alicia H. Munnell, Matthew S. Rutledge and Anthony Webb, researchers at Boston College’s Center for Retirement Research, wrote in November 2014.
“The new demographic transition is a longevity transition: how will individuals and societies respond to mortality decline when almost all of the decline will occur late in life?” Karen N. Eggleston, director of the Stanford Asia Health Policy Program, and Victor R. Fuchs, professor emeritus of economics at Stanford write in a 2012 study. The combination of longer lives and unreliable pension benefits increases retirees’ dependence “on transfers from the working population for living expenses, including large consumption of medical care,” Eggleston and Fuchs note.
In his new book, “The Business of America Is Lobbying,” Lee Drutman, a senior fellow at the New America Foundation, provides insight into a crucial element of this power shift.
Beginning in the early 1970s, just as support for redistribution began to decline, “corporate America began to devote attention and meaningful resources to politics,” Drutman writes. “The 40-year trend has overwhelmingly moved in one direction: growth. Corporate lobbying expenditures now dwarf the comparable investments of unions” and public interest or citizen groups.
From 1998 to 2012, the ratio of corporate/trade association lobbying spending to union/public interest group spending went from 22 to one to 34 to one, Drutman found.
In a November 2014 article “The Ideological Asymmetry of the American Party System,” Yphtach Lelkes of the University of Amsterdam, and Paul Sniderman of Stanford, both political scientists, develop an intriguing argument on how Republicans have mobilized public opposition to Democratic social policies that initially carried strong popular support.
The conservative strategy, they write, is to portray “social welfare policies as benefiting particular interest groups rather than society as a whole.” The more the electorate sees a policy or program as “particularistic” — as opposed to universalist — the less backing the public will give the program.
On a broader scale, the political scientists Jacob Hacker and Paul Pierson, in their chapter of the 2013 book “Representation: Elections and Beyond,” have sought to understand the logic of working-class white “support for the G.O.P. in an era of runaway inequality.”
Hacker and Pierson argue that not only has business mobilized for over four decades now, but so, too, have conservative foundations, think tanks and the religious right.
“There was a common theme linking these disparate trends: all of them worked to diminish the presence of organized voices addressing the economic concerns of ordinary Americans in Washington,” Hacker and Pierson write. “G.O.P. electoral inroads among less affluent voters have occurred alongside declining public confidence in government and growing perceptions that politicians are excessively responsive to ‘special interests.’ ”
The authors add, “In this context, calls for limited government and self-reliance receive greater hearing, especially when there are few contrary organizational signals pushing voters the other way.”
By Don McCanne, MD
A half century ago, when the nation seemed ready to ensure health care for everyone, it was decided instead to establish programs for the two groups with the greatest needs: Medicare for retirees and Medicaid for the poor. It was intended that Medicare eventually would be expanded to include everyone.
As it turns out, these two programs have such strong political support that they not only survived the half century, they will be perpetuated indefinitely as a result of the decision to enact the the policies contained in the Affordable Care Act rather than to expand Medicare, as originally intended.
Thomas Edsall provides us with a background of understanding why our seniors so passionately support Medicare while demanding that we keep the government out of their Medicare. No matter how progressive a person’s views are, there is always an element of self-interest, and quite appropriately so. Edsall, in expanding on his anti-redistributionist article of last week, explains that seniors are concerned that further redistribution to others risks reduction of redistribution to themselves, though they might not think of it in those terms. It is this fear that has contributed to declining support by our seniors for health care for all.
Of course, conservatives, through massive lobbying efforts, have leveraged this view to convert it into policy. Those who would suffer the most through a reduction in redistribution have been particularly tenacious in clinging to the idea that greater benefits for others would reduce benefits for themselves. You know that’s true because it’s on Fox News.
In reality, a well designed system of redistribution would improve benefits for everyone. The cost would be borne disproportionately by those who are already spending massively to thwart programs of social justice.
Thomas Piketty and others have shown us that disproportionate taxation (progressive taxes) is precisely what we need, and the concentration of income and wealth at the top is so great that the lifestyles of the rich would not be impaired in the least. But just try to tell that to the elderly lady carrying the picket sign stating, “KEEP GOVERNMENT HANDS OFF MY MEDICARE!”