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It’s Perfectly Fine If Rich Benefit From Universal Social Programs

I see a very concerning strain of thought among some Republicans, Democrats and even liberals that everything should be means-tested as opposed to universally available. They often trot out what I call the “billionaire strawman argument,” which I consider very destructive for long term progressive ideals.

For example, here is Hillary Clinton using it against Bernie Sanders’ plan for universal higher education. From TPM:

“I believe that we should make community college free. We should have debt-free college if you go to a public college or university. You should not have to borrow a dime to pay tuition,” Clinton said. “I disagree with free college for everybody. I don’t think taxpayers should be paying to send Donald Trump’s kids to college.”

So rather than supporting tuition-free higher education for everyone, Clinton endorsed debt-free tuition. While it’s theoretically true that anyone could apply to a public university, it is worth pointing out most billionaires’ children are probably going to a private university, which weren’t included in Sanders’ plan. Ivanka Trump went to UPenn, and Eric Trump went to Georgetown.

Here is the billionaire strawman argument again, recently used against House Republicans’ new ACA replacement proposal in the New York Times.

“That means that the biggest financial benefits would go to older Americans, like, say, Secretary of State Rex Tillerson. If he didn’t have a job in the Trump cabinet and access to government coverage, a 64-year-old multimillionaire like him would get the same amount of financial assistance as someone his age, living in poverty, and he would get substantially more money than a poor, young person.”

Again, this is theoretically true — Sanger-Katz is simply pointing out how the program could work. However, I doubt you could find even a dozen working-age Americans of Tillerson’s net worth who don’t have employer-provided insurance.

There are many good reasons to oppose this House Republican proposal; for instance, it wouldn’t provide enough funding or enough consumer protections. But the fact that Republicans are calling for a law that would make everyone entitled to the same government assistance to afford health insurance is a good thing. It would be a paradigm shift in the role of government in health care that not even Obamacare made, which is why some conservatives are so opposed to it. Progressives should not oppose a universal tax credit; they should only focus on making it large enough.

Worrying that universal programs might benefit a few billionaires will cause major technical and political problems.

First of all, there simply aren’t that many truly rich people who would actually take part. Only 1.5 percent of the country makes more than $250,000 a year, so excluding the truly rich for any universal program would save very little.

Any attempt to exclude people means you need a bureaucracy to verify eligibility that could cost more than what you even save. A means-testing bureaucracy can also find it very difficult to provide everyone with what they are supposed to receive.

To actually save any money by excluding the rich, you need to also exclude many middle class families. This means some will fall through the cracks. That is what the Affordable Care Act did by denying tax credits to those only making more than 400% of the federal poverty level. This is why under our “universal health care plan,” a 62-year-old making $48,000 would need to pay 20% of their income just to get basic coverage.

The political problem with the billionaire strawman

There is a reason our most popular government programs are universal: Medicare, Social Security, public highways, public schools, national parks, etc… When everyone is technically part of it, everyone has a political stake in its success. It is a much simpler argument to make that if we think something is essential, we should provide access to everyone.

When a program is universal, you talk about making it better for everyone. It is easier to rally a large number people for expanding Social Security or having Medicare cover prescription drugs. It is much harder to rally popular support for, say, increasing ACA subsidies for those in the 300-380% FPL. When you means test, you also leave a program open to a death by a thousand cuts and restrictions.

If you support single payer health care, you support everyone from the poor to the super rich getting access to the same benefit. That should never be seen as a bug in any policy, that is a feature.

Originally published at Pending Horizon.

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Jon Walker

Jon Walker

Jonathan Walker grew up in New Jersey. He graduated from Wesleyan University in 2006. He is an expert on politics, health care and drug policy. He is also the author of After Legalization and Cobalt Slave, and a Futurist writer at http://pendinghorizon.com