Obama Lays Groundwork to Destroy another Social Insurance

January 30, 2014

President Obama’s comments about the health law in his State of the Union speech lacked substance and were primarily focused on selling his law, and more insurance, to the public. He avoided discussing the root causes of our ongoing healthcare crisis and set the ball in motion to destroy another pillar of our social infrastructure, Social Security.

The bottom line of President Obama’s comments on the health law was that more people have health insurance and insurance companies can’t deny people based on pre-existing conditions. He urged everyone to make their friends and family buy insurance.

What he didn’t say is that people with health insurance in the United States still can’t afford the care they need and face bankruptcy if they have a serious health problem. And although insurance companies cannot deny policies to people with pre-existing conditions, they have a number of ways to avoid paying for peoples care.

The health law perpetuates a health system that treats health care as a commodity so that people only receive the amount of health care they can afford rather than treating it as a public good, as does every other industrialized nation. This is the root cause of the health crisis in the US. Any system that leaves healthcare in the marketplace, because it is based on generating profits for investors, will result in inequalities of access to care and rising healthcare costs.

Using a market-based model for social insurances sets a dangerous precedent. Traditional social insurances are provided by the government and are paid for through taxes. They are designed to meet the needs of the public rather than to provide a profit and so they guarantee a universal set of benefits for everyone. Each pays in according to their means.

The health law is doing the opposite. It is driving our entire health system to one that is provided by private entities and is paid for by individuals. Each person gets the amount of coverage they can afford. Those who cannot afford what they need are left to suffer. Since the health law was signed, there has been greater privatization of Medicaid and Medicare and billions of taxpayer dollars have been used to sell and subsidize private insurance. If we continue on this path, down the road Medicaid and Medicare will be rolled into the health exchanges and only private insurance will be available.

The same plan may be in the works for Social Security. In his speech, the President announced a new retirement savings program, MyRA. Although the details of MyRa are not clear, it is based on creating individual retirement accounts (IRAs) for workers who don’t currently have them.

What we do know is that Social Security has been under attack throughout the President’s time in office. Rather than doing what is needed, raising the cap, or going beyond that and raising benefits, there have been attempts to cut benefits and raise the age of eligibility. The public is being told that Social Security is in a crisis but is not being told that this ‘crisis’ is intentional. Unlike Social Security, IRAs are managed by financial institutions that profit from them. MyRa is another gift to Wall Street by President Obama.

We are living in an era of big finance capitalism, a predatory capitalism, based on the neoliberal economic model. It is being applied to every aspect of our society through dismantling of our public programs and privatization of our resources and services. Under this system, the basic necessities of each person are not guaranteed. Instead, it is designed to funnel wealth to the top by making everything into a commodity, a profit center for investors.

This path will continue until we rise up to challenge it. We must understand what is happening and that the destruction of our public programs is intentional, but not inevitable. There are solutions to the crises we face. For example, a health care system based on a non-profit Medicare for all model and a retirement system based on a stronger Social Security. These are obvious solutions, supported by a majority of Americans and logistically easy to put in place – if the government actually represented the people.

The President closed his remarks on health care by saying, “So again, if you have specific plans to cut costs, cover more people, increase choice, tell America what you'd do differently.” The last time he said that in a State of the Union speech, I tried to respond and was arrested. This time we must respond together by working to build a mass social movement that has the power to make our demands a reality.

~ Margaret Flowers MD, Serves as Secretary of Health in the General Welfare Branch of the Green Shadow Cabinet.