Posted by: Jeff | October 28, 2009

What’s Joe Smoking? (Part Deux)

Continuing on the Joe (not Edwards) Lieberman front – and setting aside questions of whether the Senator has betrayed the liberal cause – it’s worth pointing out that he’s criticizing the public option for things it doesn’t actually do.

Lieberman calls it “a whole new entitlement program for which taxpayers will be on the line” and suggests it will add to the national debt. Jonathan Chait goes to town:

It literally makes no sense whatsoever. A public plan does not provide a new entitlement. It just doesn’t. It’s a different form of providing an entitlement. Nor is it more expensive. In fact, the stronger versions of the public plan would cost less money. Lieberman is just babbling nonsense here.

I’m not even sure it makes sense to call the public option a “different form” of entitlement. I would define an entitlement as a government program which benefits citizens and is funded by taxpayer dollars.

As I understand it, with the possible exception of a piddling amount of start-up cash, the public option will not be funded via taxes. Other parts of health care reform will be funded through taxes, but not the public option. It will get its money from the premiums it collects from customers, just like a private insurance company. The trick is that, being government-run, the public option does not have to maintain a profit margin, can hopefully reduce overhead, and under the best case scenario can be linked to Medicare prices for greater bargaining leverage.

The public option is not an entitlement program. Flat out. The end. The taxpayers will not be on the line for squat, so by definition it will not increase deficit spending or add to the debt.

I would guess that Lieberman is smart enough and sufficiently informed to know he’s talking nonsense, and his purpose here is just to give the public a legitimate-sounding rational for what is purely a political maneuver. The sad part is that Lieberman seems to think (maybe correctly) that there is enough public ignorance out there about what the public option is and what it does that this argument can gain some traction.

Here’s Ezra Klein and Matt Yglesias piling on as well.

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