One-two punch for Pa., city
Obama's lofty health- care and climate- change measures would hurt badly.
Barack Obama campaigned on change - big change.
When members of Congress return from the August break, having received an earful from their constituents, they'll go to work on two bills that put the big in big change.
The trillion-dollar health-care bill is attracting all the attention, not only because it would affect 17 percent of our economy, but also because it would affect us as individuals. As we have seen in YouTube videos of town-hall meetings, it is very personal.
The other big change, Obama's climate bill, would wreak havoc on an even larger swath of the economy. Perhaps its effect would not be as personal, but it would be life-changing.
Obama's stated goals are lofty indeed: cover the uninsured, cut medical costs, and, oh, by the way, save the globe from climate disaster.
These two bills threaten to put government in control of more of our economy and more of our lives. While they would harm America generally, they would be especially ruinous for Pennsylvania and Philadelphia.
One of the health-care proposals would require states to expand Medicaid to cover all households with incomes of up to 133 percent of the federal poverty level. In Pennsylvania, that would mean a $1.5 billion-a-year expansion of government health care, or a 6 percent increase in spending by a state that already has an unbalanced budget.
It's worth noting that this new federal mandate would have little to no impact on blue states such as New Jersey, Delaware, New York, Massachusetts, Illinois, and California, which already have such coverage in place. But it would give Gov. Rendell another excuse for raising taxes in Pennsylvania. Anyone think he needs one?
Even after all this new spending, almost half a million Pennsylvanians would still be uninsured, according to the Lewin Group, a health-care consulting firm. And if a government plan modeled after Medicare became available to everyone, the firm predicts that a majority of privately insured Pennsylvanians would move to the government plan.
The Congressional Budget Office estimates that a much smaller number of people would migrate to a public insurance option. But the CBO assumes that the government plan would pay providers more than Medicare does and therefore charge higher premiums. That's a bogus assumption.
The health-care proposals could be financed partly through cuts in Medicare reimbursements to health-care providers. Pennsylvania ranks third, behind West Virginia and Maine, in the share of the population on Medicare. So not only would our doctors and hospitals be hurt disproportionately, but other insurance rates would go up as costs are shifted to the private sector.
Philadelphia also would feel a disproportionate impact. A proposed surtax on the "rich" to pay for expanded coverage would disproportionately strike higher incomes in the region. But the biggest hit would be to the region's bioscience industry.
American health care was born in Philadelphia. The city boasts a list of national health-care firsts: first hospital, children's hospital, medical school, cancer center, and more. Not surprisingly, those institutions are also among the nation's best. This region leads the country, and our country leads the world in innovative medicine.
Why? Because private markets reward excellence and innovation. Government-managed systems won't pay for either. With more than 40,000 people employed in bioscience jobs in the Philadelphia area, a shift away from quality and innovation would disproportionately penalize the region.
As to the climate bill, it would make coal Public Enemy No. 1, slapping enormous taxes on states that produce it and burn it for electricity. Pennsylvania is among the top five coal-producing states. More than 900 active mines employ more than 20,000 workers in the Commonwealth, in addition to almost 60,000 other jobs related to mining.
Taxing poor people in Appalachia for the benefit of California, New York, Connecticut, and New Jersey may be politically appealing to Democrats. But is it change Pennsylvanians can believe in?
Philadelphia isn't part of the coal region, but coal-fired plants provide 56 percent of the state's electricity. According to the National Mining Association, the climate bill passed by the House would increase Pennsylvania's electric bills by more than $700 million a year. Only Texas and Indiana consumers would be paying more.
This really is big change. But it would cost Pennsylvania and Philadelphia more than chump change.