Green Room

Ezra Klein: A larger welfare state means a smaller deficit, or something

posted at 1:53 pm on December 9, 2011 by

Honestly, that’s his premise. You can read it here. He bases his argument mostly in health care costs. Obviously where he tries to go with it is toward selling a single payer system. But he uses Germany as the model.

Anyone, does Germany have a single payer system? No, it has a public health insurance program that covers 88% of the population.

Take Germany. They have a pretty big welfare state: pensions, health care, paid vacations, unemployment benefits equal to two-thirds of one’s income.

So that’s great and per Klein, who, like I said, wants you to believe by his vague general description, that Germany has a system like … Canada.

Don’t believe it? Well it takes that sort of implication to make a statement like this:

To bring this across the Atlantic, you could argue that the United States’s debt burden is the product of an insufficiently large welfare state — at least with regard to health care. To see a stark illustration of that thesis, head to the Web site of the Organization of Economic Cooperation and Development and download their health-care statistics for Canada and the United States [emphasis mine].

Notice how apparently we transitioned seamlessly from a country with health insurance to a country with a single payer system without that being obvious? In reality we’ve looked at the apple, now he plans on comparing it to the orange:

As recently as 1965, the cost of those two systems competed neck-and-neck. That year, Canada spent 5.9 percent of its GDP on health care. The United States spent 5.7 percent. But around that time, Canada was transitioning to its current single-payer system. Over the next four decades, the growth of health-care costs slowed in Canada while it accelerated in the United States. By 2009, Canada was spending 11 percent of its GDP on health care — and covering everyone. The United States was spending 17.4 percent of its GDP and leaving 45 million uninsured. In dollar terms, we’re spending $3,600 more per person, per year, than Canada.

Emphasis mine. It’s a pretty ballsy attempt, I’ve got to say. Here’s another question for those paying attention. Can anyone tell me what began in 1965? Anyone? That’s right … Medicare. Per Klein, we were actually spending less than Canada until the same year that Medicare and government intrusion into the health care market was made law.

Based on that extraordinarily flawed bit of reasoning which managed to factor out or ignore a major reason for the increase in US health care costs, Klein concludes:

If the United States had Canada’s health-care system, and Canada’s per capita health-care costs, we would have a much “larger” welfare state, but we wouldn’t have a deficit problem.

Really? Seriously? You really want to run with that one, Mr. Klein?

Perhaps a less rosy look at Canada might help temper that nonsense a bit. Here’s a Canadian economic analyst speaking about the Canadian healthcare system:

“There’s got to be some change to the status quo whether it happens in three years or 10 years,” said Derek Burleton, senior economist at Toronto-Dominion Bank.

“We can’t continually see health spending growing above and beyond the growth rate in the economy because, at some point, it means crowding out of all the other government services.

“At some stage we’re going to hit a breaking point.”

It means crowding out other government services or what?

That’s right, deficits.

Well, except in Ezra Klein’s magic welfare state where one can happily spend whatever they want and there are no apparent consequences or … deficits.

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On behalf of all people in my age group:

We deeply regret giving you Ezra Klein, Barack Obama, Jersey Shore, and planking.

Well, actually planking was sorta cute for a minute or two.

And Jersey Shore can be fun when you’re as blitzed as the Jersey Shore crew.

And we aren’t entirely responsible for voting Obama into power.

So yeah, sorry about Ezra Klein. This is what happens when we slack on the swirlies.

mintycrys on December 9, 2011 at 2:06 PM

Take Germany. They have a pretty big welfare state: pensions, health care, paid vacations, unemployment benefits equal to two-thirds of one’s income.
Well, fancy that. It used to be 90% just over a decade ago. Since then, it’s been ratched down by both Schroeder & Merkel. Why is that? On top of that, they even shortened the length of time that one could receive unemployment checks.


AH_C on December 9, 2011 at 2:07 PM

Bless his heart, critical thinking is not Ezra’s strong suit.

AH_C on December 9, 2011 at 2:10 PM

So Ezra, why do so many Canadians come to the US for medical treatment?

rbj on December 9, 2011 at 2:23 PM

Guess what Ezra, you idiot. The USA has more people on FREE healthcare than the whole country of Canad has PEOPLE.

You brainiac intellectuals snobs never mention the POPULATION of Canada when you through around your useless, ridiculous statistics, do you (As recently as 1965? are fu$#@! kidding!.

Newsflash, you moron: California alone has 3 MILLION MORE people than the whole country of Canada.

Over 65 MILLION people are covered by Medicaid alone. Add Medicare and over 110 million are covered. And ObamaCare will add another 3+ million to that number.

So shut up Ezra. The USA CURRENTLY covers the healthcare (either for free or highly subsidized) for almost four times the entire population Canada.

Opposite Day on December 9, 2011 at 2:53 PM

This reminds me of the climate change “scientists”. Start with a conclusion, then twist yourself into a pretzel to get to it.

ForeLeft on December 9, 2011 at 2:54 PM

The withholding for Medicare started in January, 1966. That was the month and year that I started earning a paycheck. Lucky me. It was at the time labeled as Health Insurance. It has really changed since then.
Ezra is a very confused young man. He doesn’t realize yet where money comes from to pay for these entitlement programs. He doesn’t understand what Margaret Thatcher said about what happens when the money runs out.

dhugh on December 9, 2011 at 3:10 PM

With writing like this, it becomes very easy to understand why Ezra Klein is desperate to expand the welfare state.

It soon will be the only thing willing to pay him.

northdallasthirty on December 9, 2011 at 3:25 PM

Ha, Ha, Ha, those Onion pieces are so funny.

Smedley on December 9, 2011 at 4:47 PM

The Canadian spending growth is slower mainly because they have LONG waiting periods for simple procedures, and simply refusing to pay for some others that medicare will pay for. The medicare system, which started in 1965, is rife with fraud that nobody seems to want to fix. The growth of spending in Canada being lower than in the US doesn’t mean they have better healthcare, especially when its all gov. controlled.

revenge of prometheus on December 9, 2011 at 5:24 PM

Opposite Day on December 9, 2011 at 2:53 PM

I’m guessing this Ezra person really pushes your p**s-off buttons? Or is that just conjecture on my part?

sage0925 on December 9, 2011 at 5:41 PM

Number of Canadians who annually cross the border to get procedures in the U.S and avoid their waiting list: er conveniently not mentioned.

America’s got 99+ problems but single payer ain’t one, (yet).

2014 might tell a new story though…

Difficultas_Est_Imperium on December 9, 2011 at 10:11 PM

Wow, Mr. Klein almost beat Barry Boy for Doc’s Dunce of the Year Award™….almost….

DrScottMD on December 10, 2011 at 7:13 AM