It took some negotiating between presumptive Democratic presidential nominee Hillary Clinton and runner-up Bernie Sanders and their respective camps, but the Democratic Party finally has a draft 2016 platform. And it is very, very, very, very liberal. Desperate to consolidate the far-left of the party into her corner, Clinton is offering a massive expansion of government-provided or guaranteed entitlements.
The catch? Cost, of course. Because when the numbers are crunched, these proposals are unaffordable.
Consider, for example, Clinton’s proposal to let Americans receive Medicare benefits starting at age 55. Enabling Medicare access 10 years earlier than at present, the Clinton plan would dramatically increase federal government spending. Speaking to Opportunity Lives, American Enterprise Institute health care scholar Thomas Miller said, “My best guess is that there would be much less take up than advocates like to imply, unless the subsidy structure is far more generous, and, soon, untenable in a budgetary sense.” Miller makes a basic but critical point: the incentives and money for such a generous government expansion of entitlements must come from somewhere.
Still, what’s most remarkable about Clinton’s proposal is its timing. After all, as the Wall Street Journal reported last month, Medicare trustees now believe “the Medicare hospital-insurance trust fund, which provides coverage to more than 55 million Americans, will exhaust its reserves by 2028, two years sooner than estimated last year.” But under Clinton’s proposal to allow access to Medicare even earlier, the program would necessarily go bankrupt even sooner!
When it comes to accounting, Clinton’s plan is economic fiction veiled in social justice. Sadly, however, it’s a fiction with a very real cost. The federal government’s exploding entitlements are fueling our increasingly insurmountable national debt. More debt will constrain the opportunities available to America’s youngest citizens. It’s why I’ve argued that younger Americans should judge campaign promises from Clinton and Sanders with extreme caution. Put simply, our future is on the line.
Yet the central problem is not that Clinton’s plan is unaffordable, but rather that Medicare is already in crisis. As the Medicare trustees explain, the program’s Supplementary Medical Insurance (SMI) element, which pays doctors’ bills and other outpatient expenses, is especially precarious: “the aging population and rising health care costs cause SMI projected costs to grow steadily from 2.1% of GDP in 2015 to 3.5% of GDP in 2037.”
On paper, those are just projected statistics. But rendered onto the balance sheets of 2037, Medicare is set to impose a far higher burden on total government revenues than at present. In turn, the federal government will have to find savings in other areas (hence why Democrats are obsessed with cutting defense outlays), while also increasing deficit spending even further.
As Opportunity Lives has shown, this ballooning deficit-debt dynamic would mean a future of declining investment, high interest rates, and economic stagnation. But there’s another issue at stake here. Namely, the philosophical question of what U.S. health care should look like in the years ahead. Clinton is proposing is an overt expansion of the federal government’s control over the provision of medical care. Although liberals may have good intentions, they misunderstand the nature of socialized medicine. By sacrificing individual concerns to the subjective metrics of the centralized state, socialized medicine stifles both the quality of personalized care and the incentives for innovation.
In the end, we must judge what our politicians promise with a far greater degree of scrutiny. Just as Donald Trump’s populist plan to seize Middle Eastern oil would invite bloody regional war, Hillary Clinton’s populist expansion of Medicare would steal the future of young Americans. It is, in short, economically illiterate and morally unjust.
Tom Rogan is a Senior Contributor for Opportunity Lives and writes for National Review. He is a panelist on The McLaughlin Group and a fellow at the Steamboat Institute. Follow him on Twitter @TomRtweets.