First the money, then the market will follow the Hippocratic Oath, seen here in an appropriately Byzantine form from the 12th Century via Wikipedia.

Mike Konczal discussed the Obamacare computer system problems in this excellent article, raising the question of its implications for liberal versus neoliberal approaches to problem solving. Ross Douthat also deals with this issue from a conservative perspective in several posts, here, here, and here. In this post, he directly addresses Konczal’s argument. Douthat thinks conservatism is not the same as neoliberalism, but he seems to agree with Konczal’s definition of the latter. I think both are discussing only one small part of the neoliberal project.

Konczal says that the problems with the rollout are attributable to the design of the program, which he describes as a neoliberal approach to social insurance, “heavy on private provisioning and means-testing.”

This term [neoliberalism] often obscures more than it helps, but think of it as a plan for reworking the entire logic of government to simply act as an enabler to market activities, with perhaps some coordinated charity to individuals most in need.

The computer problems facing the neoliberal solution are difficult. They require a system that links flawlessly with a large number of other systems, all proprietary and all designed to serve other purposes. For example, calculation of the subsidy requires linking to the databases of Social Security, the IRS, the Department of Homeland Security, Veterans Health, the Department of Defense, the Office of Personnel Management and the Peace Corps. It also has to link to all of the insurance companies that participate in the system, by state. That would not be necessary in a straightforward New Deal type of solution, which might be single-payer.

Here’s how Douthat describes the conservative view:

For instance, in the kind of system that represents the beau ideal for right-of-center health policy types, instead of universal Medicaid we would have some kind of subsidized catastrophic insurance combined with health savings accounts that are tax-advantaged for most people and directly funded up to a certain level for the poor.

This proposal too involves the heavy use of the private sector, some form of subsidies, garnished with a dollop of tax reductions. Douthat seems to accept Konczal’s description of the government as market enabler with a dollop of charity.

Konczal says that the term neoliberal obscures as much as it helps. According to Philip Mirowski in Never Let a Serious Crisis Go to Waste, obscuring things is an important feature of the neoliberal project, while moving the discussion steadily in its direction. That part is working well enough that both Douthat and Konczal are enmeshed in the discussion without looking at neoliberalism itself. Neoliberalism is the unseen matrix for all discussions by elites of both legacy parties, and it is the only force inside the Tea Party.

What Konczal describes as neoliberalism is actually the Democratic Leadership Council and the New Democrat program, which accepts parts of the neoliberal program. Their purpose is to give cover to Democrats seeking corporate funding. They can continue mouthing pieties about the middle class and the poor and the working poor, while passing NAFTA and gutting financial regulation. They can bray about the war on women while defunding the EPA and OSHA. They can support Gay Marriage, while cutting Social Security, Medicare and Medicaid, as President Obama does. In the end, they achieve a goal of neoliberals, helping the filthy rich get richer and the poor get poorer. In the end, they bolster the power of the corporate state at the expense of everyone else.

Douthat does not want to provide universal coverage, and he doesn’t pretend that an individual sick people should be covered if they are poor. The global outcome is all that is important to him. He wants to make economics, not health, the central goal of reform. If that means that some people die early and painful deaths, and others are financially ruined, as long as the overall outcome is cheaper, Douthat is satisfied.

Their access to some forms of care might be better, and their protections from financial ruin reasonably solid, but the financial and personal strain of dealing with some forms of illness, whether chronic or unexpected, would undoubtedly be greater under the preferred conservative model than under a single-payer system.

That’s putting it mildly.

Mirowski devotes 27 pages to describing the current state of the neoliberal project. One of the key points is a redefinition of democracy. Citizens are not active participants in their government, with the power to direct it to the ends they think best. Instead they are redefined as consumers of services provided by the government, services that could just as easily be provided by the rich and their corporations. Power is moved behind the curtain, so that the function of the state is exactly as described by the neoliberal Judge and soi-disant public intellectual Richard Posner in his 1985 Columbia Law Review Journal article:

The major function of criminal law in a capitalist society is to prevent people from bypassing the system of voluntary, compensated exchange — the “market,” explicit or implicit — in situations where, because transaction costs are low, the market is a more efficient method of allocating resources than forced exchange. Market bypassing in such situations is inefficient — in the sense in which economists equate efficiency with wealth maximization — no matter how much utility it may confer on the offender.

Posner’s view is that the state is properly concerned with making sure people don’t buy cheap drugs in Canada. He agrees with Douthat that the problems of individuals aren’t as important as the overall efficiency of the system, and that the role of the government is to enforce economic efficiency at the expense of as many lives as necessary.

The only difference between the New Democrat approach and that of Posner and Douthat is that the former tries to reach everyone at a comparatively small cost in economic efficiency, while Posner and Douthat are willing to sacrifice a bunch of people to achieve the highest possible economic efficiency.

Why, the New Democrats and the Douthat conservatives sound just like the kind of centrist debate that the media love. Liberals are left to explain how the system doesn’t treat their opinions as legitimate. Too bad about all those people who aren’t getting help from anyone.



I read a lot of books.