Reno Hayek Symposium

August 10, 2009

Dear Mr. President,

I participate in a monthly dinner-discussion group covering current economic topics. Those of us who voted for you are highly disappointed; you misled us into thinking that you were a moderate who would lead the nation forward foregoing politics as usual. You have shown yourself to be a big government socialist trying to control every aspect of the economy racking up immoral deficits that will be a millstone around the necks of our children and grandchildren.

Your healthcare ruse is the ultimate attempt to control and perhaps the penultimate nail in the coffin of this great nation. You urge this at a time of great financial turmoil when the unfunded liabilities of Social Security, Medicaid and Medicare remain unabated.

I would humbly suggest a simple, almost costless fix for the problems you seem to have with our medical delivery system:

• First, treat employer provided medical insurance as the compensation that it logically is; the income tax should apply to it as with other compensation. This will help reduce these horrible deficits.
• Second, recognize that medical insurance is in interstate commerce and allow private insurance companies to freely compete across state lines provided they qualify under any one state’s laws.
• Third, expand the use of health savings accounts which make the consumer the decision maker and the person responsible for payment. This could be done be increasing the annual deduction for contributions.
• Fourth, place a federal cap on medical malpractice damages for pain and suffering and other such speculative elements of damage. This could be justified under the same interstate commerce clause.

These four simple, costless steps will bring down the amounts spent on healthcare, allow high deductible or catastrophic policies to freely compete, and make the consumers the real parties in interest; at the same time the tax money generated will help reduce your crippling deficits. And, they would eliminate the bureaucratic nonsense and control your plan seeks. They would allow free market choice instead of the one-size-fits-all plan you advocate; I, for instance, don’t need pregnancy insurance! Finally, they would allow the innovation that has led the world; your plan eliminates incentive to innovate.

You have children, as do I. I also have grandchildren. I don’t want to see any of these fine young people suffer from your staggering deficits. It is simply immoral, Mr. President.

Tom Motherway, tom@renohayek.com