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Orszag Puts the Lie to Health Reform Spin

If you listened to White House propaganda ministers before the health care bill was passed, you could almost be forgiven for mistakenly believing that the legislation wouldn’t cost anything.

“It’s all paid for,” the White House repeatedly insisted whenever confronted with the nearly trillion dollar ten-year cost of the overhaul, noting that cuts in other areas of the budget and tax increases kept the legislation “budget neutral” and even reduced the deficit.

This is not Peter Orszag. It's his wife, Bianna Golodryga of ABC News. White House Dossier finds her much, much better looking than him and likes to run photos of her when it can find a good excuse to do so.

This was egregious, foul smelling Washington spin on a couple of levels. First of all, it wasn’t true. The pay-fors assume things will happen that won’t happen, including a declining rate of spending increases on Medicare beneficiaries and reductions in payments to doctors who provide Medicare services, which Congress never allows.

It also starts collecting new revenues well before starting up the spending, meaning the ten-year estimate of the cost includes more years for collecting money than doling it out. That’s what’s called dishonest accounting, a standard Washington practice that would get private practitioners thrown in jail and that Obama presumably was supposed to “change.”

Secondly, the “paid for” statement implies a free lunch. The big problem with this is that the methods used to pay for the bill – including cuts of about $450 billion to Medicare, according to CBO – now cannot be used in the future to reduce the deficit. AND WE HAVE TO REDUCE THE DEFICIT.  This means that the president and Congress must in the future make other cuts and and tax increases THAT THEY WOULD NOT HAVE HAD TO MAKE IF HEALTH CARE REFORM DIDN’T PASS. So we will pay for it.

This is exactly what just-departed OMB Director Peter Orszag, now an Op-Ed writer for the New York Times and newly able to try to be honest, acknowledged in his first piece for the paper.

The health reform act included substantial savings in Medicare and Medicaid, so there aren’t further big reductions available there in our time frame.

That’s right. And everyone agrees that to reduce the deficit, you really have go after entitlement programs like Medicare. And now, at least in the short term, you can’t.

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4 Responses to Orszag Puts the Lie to Health Reform Spin

  1. Front page Wall Street Journal–and days ago in the NYT–the cos are already jacking rates…huge shocker! And of course, the companies are just passing the increases on to workers–here, you cover this. This Berwick character has also cranked up some pilot projects on how to pay, what to pay for and how to deal with doctors “on the quiet.” I hate it when they do things on the quiet. Scares the patooties off me!

  2. You’re way too nice to Mr Orzag for being “able to be honest, now”.
    By keeping silent he was complicit in foisting this trillion dollar disaster on his fellow Americans. Shame on his ‘newly found honesty’ and his willingness to conspire to place immense power over the health care industry and our lives into the hands of government hacks.
    His ‘honesty’ about the failure of the HealthCare Reform act to be self-sustaining is not news to the American public. The passage of this fiasco is the ‘ground zero’ to the downfall of the Democrat party and the birth of the ‘tea party movement’.

    • Thanks srdem65 – wasn’t intending to excuse prior dishonesty as just being part of the game, but perhaps it came off that way. Meant to actually highlight earlier dishonest about the selling and budgeting of this.

  3. The dishonesty was baked in the cake (newest cliche) when they counted a mythical Medicare cut twice–as a deficit cutter and as a health bill money source.