CLARKONOMICS: You’ve heard all the political talk show hosts discuss Mitt Romney’s VP nominee, Congressman Paul Ryan, from a political perspective. But I want to talk about him from an economic one.
Paul Ryan is a guy I’ve praised on the show as early as 6 or 7 years ago for his willingness to talk plainly about solutions for the untenable promises we’ve made as a nation when it comes to Medicaid, Medicare, and Social Security.
Meanwhile, the GOP has traditionally treated him like the crazy uncle they’d rather lock up in the closet — until now.
The sad fact is that we spend 17% of our nation’s wealth on health care each year. Other developed countries spend only around 9%, which is less than half our expenditure. Yet we have shorter lifespans than most of the other developed countries in the world to show for it.
It’s like our system is broken and those few parts that are working have sand in the gears!
Addressing the big problems
One of the doozies is who provides health care. Today, government at all levels provides nearly half. Large corporations provide around a third.
But health care should be bought individually. People of lower income or the elderly should receive a voucher to help subsidize the purchase.
In my ideal world, you would pay your premium based on age, and there would be no redlining based on your past medical history. You wouldn’t be required to have health insurance, but you wouldn’t be allowed to buy it when you’re sick either; instead, you’d have to wait 18 months.
Ryan’s ideas on this topic don’t go that far, but he does think that seniors should be given vouchers to buy private health care policies in the future. That’s a great step in the right direction because it puts the decision-making back to the individual.
Where do we go from here?
The way I see it, there are 3 paths we can follow at this moment in American history:
- We can keep spending on the benefits we’ve promised and get to the point where we’re not able to pay back our debt obligations.
- We can keep spending on the benefits we’ve promised and increase taxes dramatically to foot the bill. (But taxing the rich alone won’t be enough.)
- We can change the benefits we’ve promised, hold down tax rates and put more responsibility for providing health care and retirement back on the individual.
Ultimately, our nation’s strength and status in the world depends on us getting our arms around the budget deficit. If we’re going to control the deficit, we’ve got to get our arms around health care spending. And you don’t control that with rationing, but with giving you as the individual the power to make decisions in your own life about what you spend on health care.
As for myself, I don’t support either the Democrat or Republican ticket for November. I actively support the Libertarian candidate for president, and have given money to the party. I believe in personal responsibility and limited government to create more wealth. That’s just who I am.