HEALTH CARE/Joan Retsinas

A Pyrrhic Victory for the Moguls

Every general, especially every victorious general, worries that the victory may be Pyrrhic &endash;- that the costly aftermath will cloud the triumph.

With this tax cut, the fat-cat moguls triumphed. Lots of analysts decried the folly of cutting taxes during a time of war, when more dollars are spent on defense. The deficit will surely mount. Yet the moguls stilled the opposition. They promised that lower taxes would not just enrich the rich, but, more crucially, would spur productivity, which in turn would spike tax revenues.

Of course, the Machiavellians among us wondered whether the right-wing ideologues saw the tax cut as a Trojan Horse, one that would justify decisions to dismember the grab-bag of liberal social programs. After all, with less revenue, the government will need to cut programs. Simple math will force the sort of governmental realignment that ideological white papers wouldn't.

Whatever the rationale behind the tax-cutters' zeal, though, they may discover that their victory is Pyrrhic.

Here are a few plausible consequences of reduced federal spending on health.

1) Less money for infectious disease treatment. The super-rich live in an isolated world of privilege: first class airplane seats, dinners at five-star restaurants, vacations in exotic lands, multiple mega-mansions. They mingle with each other in the most rarefied of habitats. They don't need government-funded insurance to see doctors, have operations, get treatments, buy medicines.

The lifestyles of the super-rich, though, are built upon the labor of the near-poor: maids, porters, valets, gardeners, nannies. These people can and do get sick; and they need those government-subsidized programs to get health care. Whatever the program, whether Medicaid, Children's Health Insurance, Disability Insurance, or one of the state health programs, millions of people depend on government help to stay healthy. A tax cut threatens to pare those programs, by restricting eligibility and/or benefits. Fewer people will get less care.

Maybe ideologues will cheer this news. They shouldn't. The super-rich need the "serving classes " to stay healthy, if only because infectious diseases, from tuberculosis to influenza to hepatitis to SARS, can leap across income barriers with the suddenness of a sneeze. The cheerleaders for the tax cut may come to regret subsequent reductions in health insurance.

2) Less money for environmental regulation. The arugula-radicchio quiche at the bistro is elegant. But are the eggs pasteurized? The crowded bistro, bustling with beautiful people, is just as elegant. Is it structurally sound? The limo rides smoothly, but is it safe? The skiing at Aspen is glorious, but is the air clean? Snorkeling in the Gulf is exhilarating, but how polluted is the water?

A beleaguered, under-funded world of regulators oversees the food we eat, the places we gather, the things we buy. Businesses have always been at odds with these regulators, paid to impose rules that raise the costs of doing business. In an unfettered world, food, cribs, cars, toys, stoves, floor tiles, and most of our purchases would be cheaper to produce, cheaper to sell. With an avowedly pro-business advocate in the White House, businesses hope to see fewer restrictions. This tax cut makes it easier for the President to justify paring all the federal regulatory agencies that regulate in the name of public safety.

Before the tax-cut victors cheer their triumph, though, they should look at the air they breathe, the water they drink, the cars they drive, and the food they eat. After the tax cut, fewer regulators may be looking over corporate shoulders.

3) Less money for Medicare. Really fat cats might never need Medicare, but the average-fat cats will. Many retirees have discovered that their pension plans evaporated, their company-guaranteed health insurance shrunk, and their 401Ks plummeted with the plummeting market. They need Medicare. Yet Medicare is not a freebie. A typical enrollee pays a few thousand dollars a year for premiums, co-payments, deductibles, and medications.

Over the past decade, Congress has debated ad nauseum measures to incorporate coverage of medications into Medicare. The tax cut effectively silences that debate. Perhaps the right-wingers who dislike Medicare are congratulating themselves.

But once those ideologues reach age 65 and join the ranks of Medicare enrollees, they may regret their triumph at stifling Medicare expansion.

I hope the tax-cutters are right and that this infusion of money into the hands of the wealthy vigorously primes the economic pump, enriching everybody. If not, the victory will have been Pyrrhic.

Joan Retsinas is a sociologist who writes about health care in Providence, R.I.

Home Page

News | Current Issue | Back Issues | Essays | Links

About the Progressive Populist | How to Subscribe | How to Contact Us

Copyright © 2003 The Progressive Populist