Health-care debate: no rational decisions

July 26, 1998|By William Pfaff

PARIS -- President Clinton was elected in 1992 promising to give the United States a needed national-health insurance system. The battle that followed pitted advocates of a single-payer state system, on the Canadian or European models, against the private insurance industry, ending in a qualified victory for the latter.

Sen. Kay Bailey Hutchison, R-Texas, wrote in the New York Times a few days ago that the original Clinton proposals "would have limited our choice in doctors, cost millions of jobs and created new bureaucracies and tax increases." She rejoiced that they had been rejected.

However, U.S. voters today are in an uproar because the private industry health system that Congress chose has given them exactly what the enemies of a public system said they would get if Congress had voted for state health insurance.

The public complains that private managed-care companies limit their choice of doctors, place control both of their doctors and of the treatment he or she prescribes in the hands of huge new bureaucracies, and has increased the overall cost of their medical care, since it now is provided by organizations whose primary obligation (properly so, in terms of the choice that was made) is to make profits.

This consumer fury is expected to be a major force in the fall's primaries and congressional and gubernatorial elections. Legislation is before Congress to regulate the private health industry and restore people's right to see doctors of their choice and to appeal to independent tribunals against treatment decisions made by the insurance companies. Critics of reform say it is likely to produce still more bureaucracy and still less choice.

This is an instructive case in U.S. political anthropology. Public opinion chose the private-sector option not only because of the insurance industry's advertising blitz but also because of an old American popular hostility (which Franklin Roosevelt's New Deal did little to change) against "socialized" anything, and certainly against "socialized medicine." Nonetheless socialized medicine is what Americans got -- with business rather than the state in charge.

Funding the arts

Funding major cultural institutions provides another interesting trans-Atlantic comparison in which the choice between state and private sectors makes little practical difference to what results.

Symphony orchestras, opera and ballet companies, and museums can rarely, if ever, finance themselves from their receipts from public performances, recording and broadcasting or video rights, or museum entries. If a country wishes to have such institutions, they have to be subsidized.

Some of the politically correct will argue that orchestral performance and opera and ballet are elitist arts and should disappear if they can't support themselves, and some American conservatives would undoubtedly say much the same thing. Nonetheless Europeans and Americans continue to support all of these institutions.

Continental differences

In continental Europe this support ordinarily is provided by direct subsidy from national or regional governments or municipalities. The size and division of the subsidies may be subjected to political debate from year to year, but the principle of direct subsidy is rarely challenged.

The United States has nearly always rejected the principle of state subsidy. Private philanthropy is expected to support American orchestras, opera and dance, and also the majority of American museums and other cultural institutions.

However, as everyone knows, private philanthropy on this scale operates through professional fund-raising staffs or organizations. Benefits, dinners and balls are often involved, which add a social, and often a social-climbing, dimension to raising the money that pays for America's performing arts and cultural institutions.

But who really is paying? The same people who pay in Europe: the taxpayers. The philanthropic money given to the arts in the United States is tax-deductible. General tax revenue has to make up for the funds diverted by corporations and individuals to support the arts.

The people who head the corporations and the individuals who contribute to the orchestras and museums get to have the fun. They get to go to the balls, special performances and charitable dinners, and they get their names on plaques in concert houses and museums. The taxpayer pays for it all.

The total cost of arts subsidy in the United States probably is higher than in Europe because of all the intermediaries involved in the system of philanthropic support. In this, as in America's private health-insurance system, private middlemen take their profit (financial or social) from what in Europe is a direct transaction between state and beneficiary.

However, the American system has created and sustains the fund-raising industry, and contributes to the profits of restaurants and ballrooms, thereby helping the economy. It may be a wasteful way to subsidize the arts, but it's the way Americans prefer. As in choosing a national medical insurance system, rational choice has little to do with it.

William Pfaff is a syndicated columnist.

Pub Date: 7/26/98

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