American Amnesia by Jacob S. Hacker

Author:Jacob S. Hacker
Language: eng
Format: epub
Publisher: Simon & Schuster

Yesterday’s Great Republican Idea Is Today’s Socialist Plot

It isn’t just the voting records of Republican leaders that reveal their Great Right Migration. An even more telling way to track the GOP’s movement is to focus on its positions on core issues of governance, including health care, taxes, and policies designed to address inequality and ensure opportunity. In each of these areas, one can see a long, steady march away from the postwar consensus on the mixed economy. Proposals that most Republican policy makers had once viewed as part of government’s constructive economic role are now viewed with hostility—indeed, derided as socialism.

Health care provides a vivid example. In the debate over President Bill Clinton’s health plan, roughly half of Senate Republicans backed a competing, market-oriented approach advocated by the Heritage Foundation. It included an individual coverage “mandate” requiring Americans to have insurance, new subsidies to help low-income Americans afford coverage, and reform of the insurance market to ensure that insurers couldn’t deny coverage to those with preexisting conditions. If these elements sound familiar, they should: The Heritage plan provided the blueprint for the bill that passed in Massachusetts with the support of GOP governor Mitt Romney. As late as 2008, Newt Gingrich and many other leading Republicans continued to support this basic model. Yet when these same principles became the template for President Obama’s plan the following year, it turned out that the GOP had always been at war with Eurasia. Every national Republican, including Romney and Gingrich, denounced it in the most apocalyptic terms.7

Once, the Republican Party could be counted on to work with Democrats to restrain the growth of federal health spending by using Medicare’s bargaining leverage to hold down provider charges. (In fact, Reagan and George H. W. Bush each spearheaded new payment controls, with substantial GOP support in Congress.) Until 1994, that is. Beginning under Gingrich, Republicans renounced these once bipartisan efforts to control costs within the health care industry. Instead, GOP leaders focused their proposals on cuts in benefits, even ones that would in practice have little impact on overall costs. They advocated turning Medicaid into a limited “block grant” to the states, and proposed to transform Medicare into a voucher-style system in which the federal government made a fixed contribution to the cost of private plans. According to expert analyses, the Medicaid proposal was basically a huge stealth cut in benefits, leaving the states to do the dirty work of slashing the program. Similarly, Medicare vouchers promised to shift health costs from the federal government onto beneficiaries but do little to restrain overall health spending or prices.8 Cost control was now about cutting benefits, not delivering them for less—at least if delivering them for less meant reducing the income of health insurers, drug companies, and other medical interests.

The GOP has also turned right on issues related to taxes and deficits. Ronald Reagan agreed to raise taxes on numerous occasions, maintaining the established bipartisan formula for handling budget deficits: cut spending and raise taxes. After 1990, Democrats continued to accept the same basic approach.

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