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People are unemployed for all sorts of reasons. Some people like to use terms like ‘involuntary unemployment’ and ‘voluntary unemployment’ to describe those reasons. In my view this is a big mistake. These terms are not helpful ways to summarize very complex and subtle distinctions. Indeed when I see people using these terms I generally tune them out, assuming they won’t have anything interesting to say about unemployment.

I know much less about health insurance than I do about unemployment, so the rest of the post is more of a “bleg” than a set of opinions. My first question is what is the goal of Obamacare? Here’s a graph showing the share of Americans who lack health insurance from 2008 to 2014.

The share of the population that is uninsured has dropped sharply since last summer. On the other hand the share of Americans lacking health insurance has risen in the 5 and 1/4 years since Obama was elected, from 15.4% to 15.6%. On the other, other hand 3 or 4 million more Americans will have health insurance by 2014:3. On the other, other, other hand that’s less than 2 percent of adults. So the share lacking health insurance will still be almost as high as in the summer of 2008. Or am I missing something?

Now let’s consider the goal of Obamacare. If the goal is to eliminate uninsuredness, then it seems to have failed. But perhaps the goal is to eliminate involuntary uninsuredness. After all, all of the sad stories we were told before the law was passed tended to focus on people who were unable to get treated for illness, or perhaps were financially devastated by the cost of treatment. If I’m not mistaken that will no longer occur, as no one can be turned down for having pre-existing conditions. Or is that assumption false? If there is no involuntary uninsuredness, can we consider the problem solved?

One objection might be that we need everyone covered, as otherwise the uninsured will tend to overuse emergency room services. But unless I’m mistaken there are studies showing exactly the opposite, that when given health insurance people tend to use the ER more often. Is that true? If so, why do we need to have everyone covered? Why isn’t it good enough to eliminate involuntary uninsuredness? Is the fear a “death spiral” that drives the insurance companies out of business?”

I’m sure this post contains many mistakes, and hope my commenters can educate me.

PS. In my view Obamacare did lots of bad things and two very good things. The good things were eliminating involuntary uninsuredness and the Cadillac plan tax. I opposed the program, but have an open mind on how it will pan out. We’ll know much more in 10 years. One key test is whether Congress will avoid “doc fixes” to the Cadillac plan tax.

PPS. Haven’t read Piketty’s new book yet, but a question for people who have. I’m told that he assumes the real rate of return on capital is about 5%, and that this is well above the real GDP growth rate. That assumption seems OK. But here’s what confuses me. Some of the reviews seem to imply that Piketty argues that real rate of return on capital represents the rate at which the wealth of the upper classes grow. Is that right? If so, what is the basis of that argument? I don’t think anyone seriously expects the grandchildren of a Bill Gates or a Warren Buffett to be 10 times as wealthy as they are. I’m pretty sure I’m misinterpreting his argument, so I hope someone can set me straight.

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This entry was posted on April 08th, 2014 and is filed under Misc.. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or Trackback from your own site.



