In his blog post point out the incredible stupidity of Joe Lieberman’s idea to shrink Medicare, Paul Krugman produces this very nice chart showing not only that government run health insurance is much cheaper than private insurance, but also has much slower growth rate.
This is of course why if our political leaders actually cared about reducing the deficit they would be talking about simply expanding Medicare instead of cutting it.
Medicare can provide the same level of benefits for roughly 25 percent less than private insurance companies. We also know from the health care debate that the CBO and JTC assume any reduction in companies spending on tax exempted health insurance benefits will result in more tax revenue through either higher wages or business profits. Simply opening up Medicare and allowing companies to buy into it would by itself would produce hundreds of billions in deficit reduction. In addition replacing the foolish new private insurance exchanges creating by the Affordable Care Act with a Medicare style program would also reduce the deficit by a few hundred billion.
Going even farther and fully expanding Medicare into a single payer health care system for everyone should bring our health care cost down towards international standard that would basically eliminate any long term deficit concerns.
Expanding Medicare is idea that would fulfill their stated goal of reducing the deficit while both helping millions better afford their health care and not cutting aid to the old, disabled and poor. Of course it isn’t being discussed because those currently demanding immediate austerity have repeatedly proven with their passed actions this isn’t about the deficit. The deficit is just the latest excuse to help the rich while take away services from regular people in the name of austerity.