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Ronald Reagan’s Advice on Health Reform

February 7, 2011

Forbes.com (February 6, 2011) – Today, February 6, would have been Ronald Reagan’s 100th birthday. Over at National Review, I published a piece on Reagan’s views on health care policy:

Image via Wikipedia.

In 1961, Reagan recorded an LP on behalf of the American Medical Association’s Operation Coffee Cup, a campaign to defeat the single-payer health plan that came to be known as Medicare. (Doctors’ wives would organize coffee meetings in order to persuade their friends to write letters to Congress in opposition to the bill.)

You can listen to Reagan’s recording, “Ronald Reagan Speaks Out Against Socialized Medicine,” in the YouTube video below. One of the more interesting bits occurs at the 3:44 mark, where Reagan endorses the Kerr-Mills Act of 1960, an alternative to Medicare that was sponsored by two conservative Democrats, Sen. Robert Kerr (D., Okla.) and Rep. Wilbur Mills (D., Ark.). Kerr-Mills, signed into law by President Eisenhower, empowered the federal government to provide block grants to states, that states could then use to create their own programs for the medically needy:

What is the Kerr-Mills bill? It is a frank recognition of the medical need or problem of our senior citizens that I have mentioned. And it has provided, from the federal government, money to the states and the local communities that can be used at the discretion of the state to help those people who need it.

Now what reason could the other people have for backing a bill which says, “We insist on compulsory health insurance for senior citizens on a basis of age alone, regardless of whether they are worth millions of dollars, whether they have an income, whether they’re protected by their own insurance, whether they have savings?” I think we could be excused for believing that, as ex-Congressman Forand said, this was simply an excuse to bring about what they wanted all the time: socialized medicine.

James Madison in 1788, speaking to the Virginia Convention, said, “Since the general civilization of mankind, I believe there are more instances of the abridgement of the freedom of the people by gradual and silent encroachment of those in power, than by violent and sudden usurpations.”

You don’t hear much about the Kerr-Mills Act anymore, for a reason. After the enormously consequential election of 1964, which returned Lyndon Johnson to the White House and swept large liberal majorities into Congress, the Kerr-Mills Act was rendered obsolete by the passage of Medicare and Medicaid in 1965.

Had it been allowed to play out, Kerr-Mills could have evolved into an effective, federalist approach to health care reform. We’ll never know.

In response, Jamelle Bouie of The American Prospect writes:

I’m amused, if only because the real noteworthy thing about Reagan’s performance was his warning that Medicare would put the United States on a road to Soviet tyranny. A half-century later, and the United States is still a mixed capitalist economy, with a (mostly) functioning democracy, and a distinct lack of gulags, work camps, and mass executions. Indeed, even the avowedly anti-tyranny Ronald Reagan had little interest in ending Medicare once he became president, as it had yet to enslave ordinary Americans. The broader lesson? Conservatives will always attack expansions of the welfare state as intolerable constraints on freedom, and eventually accept them as standard parts of the political landscape.

While Bouie makes some fair points, his comments imply that he doesn’t take seriously the consequences of the below chart, which maps out the contribution of Medicare and Medicaid to the pending bankruptcy of the United States:

I would note that this chart does not include interest on the debt, which will climb even more dramatically over the projected period.

Whether or not Medicare and Medicaid are politically popular, the fact remains that these programs are disastrously inefficient, offering the elderly and the poor worse care than they could receive under a less socialized system, and putting the country’s financial stability under significant risk.

The bottom line is that Kerr-Mills would have likely evolved into a much better and more sustainable system than the one we have now. The more we can move in that direction, the better. In that way, we would have done well to heed the Gipper’s advice.

Here’s the YouTube recording:

By: Avik Roy

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