New Senate Health Bill: Exacerbating Federal Fiscal Insanity
John Ligon /
Senator Reid seems comfortable with clandestine negotiations in order to ensure passage of any type of health reform. This course, aside from being politically dubious and whimsical, is fiscally reckless, and with its passage, will continue to add to the debt that will straddle future generations with a significant amount of fiscal stress.
As with the previous health reform bills, the assumptions and parameters the Congressional Budget Office must use will likely score this new bill as deficit neutral. Yet, the price tag for the overall bill will not changed, and will include massive expansions of Medicare and Medicaid making the long-term fiscal outlook in the US dismal at best.
Now, Congress wants to also raise the debt limit to finance more spending—including any type of health reform. Existing healthcare entitlement spending is already on an unsustainable course, however, and the intergenerational fiscal imbalance will only worsen, where future generations will face substantially higher net lifetime tax rates, permanently lower federal government purchases and transfers, or some combination of the two policy changes.