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Inequality

When Socialism Just May Offer Us an Answer

Research & Commentary
October 02, 2014

by Sheila Kennedy

By socializing access to health insurance, the Affordable Care Act improved both our economic and moral health.

By Sheila Suess Kennedy

Thanks to Obamacare, fewer Americans are declaring bankruptcy

The Affordable Care Act demonstrates that socializing a problem can be beneficial for both our economic and moral health.

We increasingly use words as epithets, rather than as a way to describe reality. This is most pronounced in our political life, where terms like “liberal” — which used to mean “open minded,” “generous,” or a follower of the philosophy of John Locke — became an insult to be hurled at people who favor a marginally more activist government.

When “liberal” lost its sting, partisans moved on to “socialist.”

The problem is that few people using the term seem to know what socialism is. Sometimes a socialist solution to a problem can actually be good for capitalism (another system which few can define with any precision), and very good for ameliorating inequality.

Case in point? The Affordable Care Act. Also known as Obamacare, the ACA is unremittingly attacked for being “socialist.” And it is true that it represents an effort to socialize access to health insurance.

In this context, what does socialism actually mean?

The ACA is hardly an unprecedented departure from a purely free-market economy. Ours is a mixed economy, meaning that over the years policymakers have determined that some services are more appropriately or efficiently provided communally, through units of government, and others are best left to the market. [pullquote] The ACA is hardly an unprecedented departure from a purely free-market economy. [/pullquote] We socialize police and fire protection. Most cities have socialized garbage collection. Federal and state highways and city streets are public goods provided by governments and paid for through largely redistributive taxes. We provide publicly-financed parks and museums and public schools. Medicare, Medicaid and Social Security all offer “social insurance.”

With passage of the ACA, the Obama Administration and Congress finally added health insurance to the list.

The ACA is far from perfect. Some of us would prefer a single-payer system similar to those that operate in many European countries. Others fault the law’s complexity. Interest groups that stand to lose profits under the new accounting rules argue the fairness of those provisions. Such complaints are fair enough, and they are to be expected when any major new program is introduced. Much as we saw with Medicare, we can expect modifications going forward.

[pullquote] What is much harder to understand is the level of animosity towards universal health insurance. [/pullquote] What is much harder to understand is the level of animosity aroused by this effort to provide struggling Americans access to health insurance.  Opponents of the ACA call it “socialized medicine,” as though the very label should be evidence that it is anti-American to use tax dollars to subsidize coverage for those who cannot afford it. People who accept their Social Security benefits and love their Medicare positively froth at the mouth at the notion that society has any obligation to extend access to basic medical care.

The irony here is that the very people who are fighting tooth and nail to bring down the ACA—bringing lawsuits, supporting candidates who vow to repeal it—are also the Act’s beneficiaries. America’s previous non-system—the most expensive in the world by far—was dragging the whole economy down. More than half of all personal bankruptcies were triggered by health costs, and the escalating costs of insurance were a drag on job creation. In the wake of the ACA’s passage, all of these indicators have improved. [pullquote] There is something very wrong with a society that rations healthcare by the ability to pay. [/pullquote]

It isn’t just that the ACA has improved our economic health. It has also improved our moral health. There is something very wrong with a society that rations healthcare by the ability to pay—a society willing to tell its most vulnerable members that they do not deserve even basic healthcare.

Whatever we call this decision to even the playing field just a bit, to mend this one major hole in the social safety net, it brings us closer to that elusive thing called civilization. If that requires a bit of socialism, so be it.

Sheila Suess Kennedy, J.D. is Professor of Law and Public Policy in the School of Public and Environmental Affairs at Indiana University Purdue University at Indianapolis. Her scholarly publications include eight books and numerous law review and journal articles. Professor Kennedy is a columnist for the Indianapolis Business Journal and a frequent lecturer, public speaker and contributor to popular periodicals. She blogs at www.sheilakennedy.net

 

Topics
Inequality,
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