Health Reform and Disaster Inflation

http://www.futureofcapitalism.com/2010/03/health-reform-and-disaster-inflation

President Obama, in his Fox News interview yesterday, defended the "Louisiana Purchase" of including extra money in the health care overhaul bill for the state of on-the-fence Senator Mary Landrieu by saying, "Something that was called a special deal was for Louisiana. It was said that there were billions — millions of dollars going to Louisiana, this was a special deal. Well, in fact, that provision, which I think should remain in, said that if a state has been affected by a natural catastrophe, that has created a special health care emergency in that state, they should get help. Louisiana, obviously, went through Katrina, and they're still trying to deal with the enormous challenges that were faced because of that. That also — I'm giving you an example of one that I consider important. It also affects Hawaii, which went through an earthquake. So that's not just a Louisiana provision. That is a provision that affects every state that is going through a natural catastrophe."

That might make sense, except that, as this New York Sun editorial, "Disaster Inflation" points out, the bar for what constitutes a federally designated natural disaster is now exceedingly low. From 2003 to 2007 alone, the Sun editorial pointed out, New York suffered through no less than 11 federally defined "major disasters." The Sun editorial put it:

The story of local responsibilities being shifted to the federal government is one of the themes of American history in the 20th and 21st centuries, and it can be seen in the numbers of federal "major disasters" tracked on the FEMA Web site. Between 1953 and 1968, there wasn't a year in which the number of major disasters nationwide exceeded 25. Between 1996 and 2006, there wasn't a year in which there were fewer than 44 major disasters, with the high being reached in 1996, when there were 75.

It's not that storms, fires, and floods are twice as common now as they were in the 1950s and 1960s, but that state and local politicians are twice as quick to cry to Washington for help, and Washington is twice as ready to open the federal funding spigot in return. Disasters of federal magnitude seem more common in presidential or congressional election years. Again, we doubt that storms, fires, and floods are more common in election years; it's just that in an election year, the White House is less likely to decline a state request for assistance, and more likely to be generous with taxpayer funds.

The law currently governing such federal disaster aid, the Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988, is bad enough. To compound it by entwining it with federal health care spending would make the problem even worse. All so the president can talk himself into believing that buying Senator Landrieu's vote is somehow sound public policy? I'd almost rather have the president just say, look getting a bill passed in Washington sometimes requires special deals for special regional political interests, it's the nature of the give and take of politics, and it isn't pretty, but it's how things get done, than to attempt to cloak the deals in the pure motive of helping disaster victims.

The fact that the presence and availability of federal disaster aid encourages more states and local jurisdictions to seek the aid by having their thunderstorms declared major federal disasters is actually quite relevant to the incentives of a health care overhaul. The presence and availability of federal subsidies for health insurance, medicine, and medical care will encourage Americans to go to the doctor more, use more medicine, have more tests, and buy more health insurance. Some people think that's a good thing, others think that's a bad thing, but it's hard to argue with the proposition that if the federal government makes a pot of money available to help people, whether it is disaster victims or the sick, people will arise to spend it. That isn't to deny that there are real sick people and real disasters, and that real sick people and real disaster victims may sometimes need help from the government. But the existence of government assistance will expand the definition of sick people, just as it expanded the definition of disasters.

Update: Gateway Pundit says that the Hawaii earthquakes involving significant fatalities were in 1868 and 1975.

by Ira Stoll  |  Mar 18, 2010 at 9:42 am Related Topics:  Health Care, New York, Politics, President Obama, Press receive the latest by email: subscribe to the free futureofcapitalism.com mailing list