A Republican Congress and President Bill Clinton abolished a welfare programme in 1996 under the (largely fallacious) pretext that it bred fraud, waste and abuse. Thirteen years on, the reforms that Barack Obama is proposing will not fundamentally change the United States’ abysmal healthcare system because those who profit from it have been able to buy protection from the lawmakers. The welfare programme ditched in 1996 absorbed about 1% of the US budget; today’s well-ensconced private insurance companies swallow most of the 17% of the budget set aside for healthcare.
Paradoxically, the US president is one of the most spirited prosecutors of the system he has chosen to retain. Day after day he recounts how "we are held hostage by health insurance companies that deny coverage, or drop coverage, or charge fees that people can’t afford for care they desperately need… We have a healthcare system that too often works better for the insurance industry than it does for the American people" (1).
Obama’s project initially set out with two important objectives. It proposed compulsory health cover for the 46 million Americans outside the system while funding the poorest amongst them. It also suggested the creation of a public insurance system with less prohibitive tariffs than private companies (2), which commit huge resources to finding legal loopholes ("pre-existing conditions") allowing them not to pay out when their insured clients fall ill.
What is it that so alarms the right? Bobby Jindal, the Republican governor of Louisiana, claims that "any government plan will benefit from taxpayer subsidies and be able to operate at a financial loss, competing unfairly in the marketplace until private plans are driven out of business" (3). Other more telling tales of distress might have concerned him, particularly in Louisiana, one of the poorest US states.
American politics is so poisoned by money flowing from industrial and financial lobbies that the only proposals ensured a smooth ride through Congress are those that cut taxes. Banks, insurance companies and the pharmaceutical industry have almost nothing to fear. Max Baucus, the Democrat chairman of the Senate finance committee, whose approval is needed for reforms to be adopted, is also the lawmaker who receives the most money from private hospitals, insurance companies and doctors. However, his largest donors are hardly worried about the problems of Montana, the small rural state he represents, since 90% of their contributions come from elsewhere in the country, in a perfectly legal and accountable way. Will anyone be surprised to hear that Baucus opposes a complete overhaul of the current medical system?
A year after the crash of neoliberalism, the (small-scale) panic that gripped the ruling classes has vanished. The political system remains locked in their favour. From time to time, a more corrupt or unlucky operator goes to jail; the mantra – morals, ethics, regulation, G20 – is chanted; then it all starts again. Questioned recently about the huge bonuses awarded to traders at BNP-Paribas, Christine Lagarde, France’s economy minister and a former Chicago business lawyer, had only this to say: "If we say no more bonuses, the best trader teams will simply move elsewhere."
Cradled in a political system that protects them (and which they in turn protect) and profiting from the public’s widespread cynicism and all-round despair, traders and medical insurance companies can only pursue their parasitic ways. "Abuse" is not some aberration in their practice, it’s their essence. So a "reform" they could agree to will not do: what we need is their disappearance.
Translated by Robert Waterhouse
(1) Town hall meeting in Montana, 14 August 2009.
(2) In 15 of the 50 states, more than half of the "market" is held by one private healthcare company. See "The Tight Grip of Health Insurers," Business Week, 3 August 2009.
(3) Bobby Jindal, "How to Make Health-Care Reform Bipartisan", The Wall Street Journal, 22 July 2009.