$2 Trillion in Phantom Health Care Savings

With great fanfare and front page coverage in yesterday’s Washington Post, some of the top health care interest groups lined up to hand the nation $2 Trillion dollars in pledged savings over the next 10 years.

Promises about savings in the future for government cash for universal care now.

There is a fantasy-land quality to the entire fiscal approach in Washington, D.C. these days.

Will health care reform be endangered by the fact that the U.S. borrows almost half of every dollar it spends?

But when promises of future savings by interest groups — not U.S. government agencies — are treated as if they are real by the media, then we have really entered the Alice in Wonderland rabbit hole, indeed.

Here is what the normally cheer-leading Washington Post editorial board said in its editorial titled “$2 Trillion in Hope”:

“None of the interest groups signed up for a specific number; no one is saying who will sacrifice what, or how much. All are promising to “do our part,” but the actual share of the $2 trillion that would fall on each pair of shoulders was not laid out. What would make up the substance of the plan? That remains to be seen. How would the private sector be held accountable for this promise to reduce costs? That, too, remains to be seen.The White House has emphasized repeatedly that health-care reform is entitlement reform — that is, an answer to the nation’s long-term fiscal challenge. Yet, so far, it is backing a plan to expand coverage that would cost taxpayers between $1 trillion and $1.5 trillion over 10 years, while it has proposed health-care savings of only $309 billion. There is a danger that the administration and Congress alike will be tempted to “pay for” actual government expenditures with presumed but unspecified savings, like those promised yesterday. In fact, even as they promise cost control, a number of the groups that met with the president yesterday also have argued that health-care reform should not be held to Congress’s pay-as-you-go rules.”

As the financial implications of this sort of health care and financial happy-talk sink in, the nation will begin to have global credibility problems.

The U.S. budget deficit for 2008 was $459 billion.  The U.S. budget deficit for 2009 is going to be $1.84 Trillion.

And all the while the fiscal health of the nation deteriorates, health care interest groups lobby for an exemption to the pay-as-you-go rules.

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