Macro Roundup

“…According to the Gallup poll, 70 percent of Americans with private insurance rate their coverage as “excellent” or “good;” 85 percent say the same about the medical care they receive. The Kaiser poll found that the percentage of Americans who support a national health plan drops by 19 percentage points when people hear that it would eliminate insurance companies or that it would require Americans to pay more in taxes…”

Jonathan Martin and Abby Goodnough, "Medicare for All Emerges as Early Policy Test for 2020 Democrats,"New York Times, February 2, 2019, https://www.nytimes.com/2019/02/02/us/politics/medicare-for-all-2020.html

Medicare for All Emerges as Early Policy Test for 2020 Democrats

WASHINGTON — Senator Elizabeth Warren spoke at length this week about her vision for improving the American health care system, like strengthening the Affordable Care Act and making prescription drugs more affordable. Twice, though, she ignored a question posed to her: Would she support eliminating private health insurance in favor of a single-payer system?

“Affordable health care for every American” is her goal, Ms. Warren said on Bloomberg Television, and there are “different ways we can get there.”

To put it another way: I am not walking into that political trap.

Ms. Warren of Massachusetts and three other liberal presidential candidates support a Medicare for All bill, which would create a single-payer health plan run by the government and increase federal spending by at least $2.5 trillion a year, according to several estimates. But Ms. Warren’s determination to sidestep an essential but deeply controversial issue at the heart of the single-payer model — would people lose the choices offered by private insurance? — illustrated one of the thorniest dilemmas for several Democrats as the 2020 primary gets underway.

Their activist base, inspired by Senator Bernie Sanders of Vermont, believes that the party should unabashedly pursue universal health care, ending private insurance entirely. But polls indicate that the broader electorate, particularly the moderate- and high-income voters who propelled the party’s sweeping suburban gains in the midterms, is uneasy about this “Medicare for all” approach in which many would lose their current insurance options and pay higher taxes.

Senator Kamala Harris of California drew immediate attacks from Republicans this week by taking on the issue that Ms. Warren dodged. Ms. Harris breezily acknowledged in a CNN town hall forum that she would “eliminate all of that,” referring to ending private insurance in a country where almost 60 percent of the population receives coverage through an employer.

Her remark triggered an intraparty debate about an issue that until now had been largely theoretical: A decade after Democrats pushed through the most significant expansion of health care since the Great Society, should they build incrementally on the Affordable Care Act or scrap the insurance sector entirely and create a European-style public program?

Four Democratic presidential candidates — Ms. Harris, Ms. Warren, Senator Kirsten Gillibrand of New York and Senator Cory Booker of New Jersey — are among the co-sponsors of Mr. Sanders’s Medicare for All bill, which would replace the Affordable Care Act with a single government health plan for all Americans. Medicare is the federal program providing health coverage to people 65 and older.

The concept of Medicare for all has become popular with Democrats: 81 percent support it, according to a recent Kaiser poll. Yet voter opposition to surrendering the insurance they are used to led to a backlash over President Barack Obama’s repeated promise that “if you like your plan, you can keep your plan” after it proved false for several million people under his health law. Many Democrats are keenly aware of that backlash, and the 2020 presidential race will be the first where many of the party’s leading candidates will have to explain and defend the meaning of Medicare for all.

For now, as Ms. Warren demonstrated, many candidates do not want to wrestle publicly with the details. After Ms. Harris’s comment, her aides hastened to add that she would also support less sweeping changes to health care; like most other candidates, Ms. Harris declined an interview request. And by Friday, Mr. Booker, hours after announcing his presidential bid, sought to curtail the matter by offering a brisk “no” when asked if he supported eliminating private coverage.

Yet there is one likely 2020 contender who is thrilled to discuss Medicare for all.

Mr. Sanders, in an interview, did not mince words: The only role for private insurance in the system he envisioned would be “cosmetic surgery, you want to get your nose fixed.”

“Every candidate will make his or her own decisions,” Mr. Sanders said, but “if I look at polling and 70 percent of the people support Medicare for All, if a very significant percentage of people think the rich, the very rich, should start paying their fair share of taxes, I think I’d be pretty dumb not to develop policies that capture what the American people want.”

But Michael R. Bloomberg, the former New York City mayor who is considering a 2020 bid on a centrist Democratic platform, said it would be folly to even consider a single-payer system. “To replace the entire private system where companies provide health care for their employees would bankrupt us for a very long time,” Mr. Bloomberg told reporters in New Hampshire on Tuesday.

The Congressional Budget Office has not scored Mr. Sanders’s Medicare for All bill, but a study last year by the Mercatus Center of George Mason University predicted it would increase federal spending by at least $32.6 trillion over the first decade. The cost could be even greater, the study says, if the bill overestimated the projected savings on administrative and drug costs, as well as payments to health care providers.

The divide between Mr. Sanders, a democratic socialist, and Mr. Bloomberg, a Republican-turned-independent-turned-Democrat, reflects the large chasm in a party that has been reshaped by President Trump.

The president’s hard-line nationalism has simultaneously nudged Democrats to the left, emboldening them to pursue unambiguously liberal policies, and drawn independents and moderate Republicans to the party because they cannot abide his incendiary conduct and demagogy on race. These dueling forces have created a growing but ungainly coalition that shares contempt for Mr. Trump but is less unified on policy matters like health care.

And these divisions extend to what is wisest politically.

Liberals argue that the only way to drive up turnout among unlikely voters or win back some of the voters uneasy with Hillary Clinton’s ties to corporate interests is to pursue a bold agenda and elevate issues like Medicare for all.

“Those who run on incremental changes are not the ones who are going to get people excited and get people to turn out,” said Representative Pramila Jayapal of Washington, the co-chair of the Congressional Progressive Caucus.

And by preserving their options, Democrats risk alienating liberal primary voters, some of whom consider support for Medicare for all a litmus test.

“The center is not a good place to be on these policies anymore,” said Mary O’Connor, 61, a substitute teacher and horse farmer in Middleburg, Va., who wants a single-payer system. “I’ll be watching extremely closely, and I will most likely jump on board and volunteer for whoever it is that’s going to be the most forceful for this.”

But moderates believe that most Democratic primary voters are more fixated on defeating Mr. Trump than applying litmus tests — and that terminating employer-sponsored insurance would only frighten the sort of general election voters who are eager to cast out Mr. Trump but do not want to wholly remake the country’s health care system.

“Most of the freshmen who helped take back the House got elected on: ‘We’re going to protect your health insurance even if you have a pre-existing condition,’ not ‘We’re going to take this whole system and throw it out the window,’” said Kenneth Baer, a Democratic strategist.

While polling does show that Medicare for all — a buzz phrase that has lately been applied to everything from single-payer health care to programs that would allow some or all Americans to buy into Medicare or Medicaid — has broad public support, attitudes swing significantly depending on not just the details, but respondents’ age and income.

On the House side, a bill similar in scope to Mr. Sanders’s is under revision and will soon be reintroduced with Ms. Jayapal as the main sponsor. Other Democrats have introduced less expansive “Medicare buy-in” bills, which would preserve the current system but would give certain Americans under 65 the option of paying for Medicare or a new “public option” plan. Another bill would give every state the option of letting residents buy into Medicaid, the government health program for poor Americans.

The buy-in programs would generally cover between 60 and 80 percent of people’s medical costs and would require much less federal spending because enrollees would still pay premiums and not everyone would be eligible. Some proponents, like Senator Jeff Merkley, Democrat of Oregon, have described them as a steppingstone on the way to a full single-payer system; some of the Democrats running for president are co-sponsoring these “Medicare for more” bills as well as Mr. Sanders’s.

Mr. Sanders has suggested options to raise the money needed for his plan, such as a new 7.5 percent payroll tax and a wealth tax on the top 0.1 percent of earners. He has also predicted several trillion dollars in savings over 10 years from eliminating the tax exclusion that employers get on what they pay toward their workers’ insurance premiums, and other tax breaks.

But Robert Blendon, a health policy professor at Harvard who studies public opinion, said it would be wise not to delve into financing details for now.

“The reason it failed in Vermont and Colorado was taxes,” Professor Blendon said, referring to recent efforts to move to a near-universal health care system in those states, which flopped resoundingly because they would have required major tax increases. “But Democratic primary voters will not go deep into asking how these plans will work. What they will say is, ‘Show me you have a principle that health care is a human right.’”

The general election will be a different story, Professor Blendon added. If Ms. Harris were to become the Democratic nominee and keep embracing the idea of ending private coverage, he argued, “she’s going to have terrible problems.”

The difficulty for Democrats, added Ezekiel Emanuel, a former Obama health care adviser, is that many voters look at the health care system the same way they view politics. “They say Congress is terrible but I like my congressman,” as Mr. Emanuel put it.

According to the Gallup poll, 70 percent of Americans with private insurance rate their coverage as “excellent” or “good;” 85 percent say the same about the medical care they receive. The Kaiser poll found that the percentage of Americans who support a national health plan drops by 19 percentage points when people hear that it would eliminate insurance companies or that it would require Americans to pay more in taxes.

Among those who make over $90,000 a year — the sort of voters in the House districts that several Democrats captured in the midterms — those surveyed in the Kaiser poll were particularly wary of an all-government system: 64 percent in this income group said they would oppose a Medicare for all plan that terminated private insurance.

“My constituents are tired of bumper sticker debates about complex issues,” said Representative Lizzie Pannill Fletcher of Texas, a freshman from an affluent Houston district. “We don’t want ideologues in charge.”

In Vermont, where former Gov. Peter Shumlin shelved his ambitious plan for a single-payer system in 2014 after conceding it would require “enormous” new taxes, advocates for universal health care are now resigned to a more incremental approach.

Dr. Deb Richter, a primary care doctor who helped lead the state’s single-payer movement, said that while the Democratic field is “going to have to face the T word,” being upfront about the required tax increases, she now thinks phasing in a government-run system is a better approach.

“There’s ways of doing this that don’t have to happen all at once,” she said, pointing to a push in Vermont to start with universal government coverage for primary care only. “But you need to talk about the end goal: We are aiming for Medicare for all, and this is a way of getting it done.”

"...That means he could be earning about $72,000 a year from rides and between $1,200 and $3,600 a year from Cargo and Play Octopus, for a total of about $75,000. That’s before taxes, though, and doesn’t factor in expenses like gas, insurance and maintenance, which can add up to nearly $20,000 a year...."

Kathleen Elkins, "I spent a day with a full-time Uber, Lyft and Juno driver in NYC—here’s how much he earned in 9 hours,"CNBC, February 4, 2019, https://www.cnbc.com/2019/02/04/how-much-money-nyc-uber-lyft-and-juno-drivers-can-earn-in-a-day.html

I spent a day with a full-time Uber, Lyft and Juno driver in NYC—here’s how much he earned in 9 hours

Al Castillo, 33, drives full-time for Uber, Lyft and Juno in New York City.

He typically works six days a week, Monday through Saturday, for nine to 11 hours a day. And, as I saw when I spent a day shadowing him, he rarely takes breaks. After all, the more rides he completes, the more he gets paid, so “you want to be busy all the time,” he told me. “Our time is money.”

On this particular day, a Wednesday, Castillo worked about nine hours, 7 a.m. to 4 p.m., and earned $233 from 15 rides. Nine rides and $140 came from Lyft, while six rides and $93 came from Uber.

“That’s a good day,” he told me, especially considering he took more breaks than usual to accommodate my filming. On a normal day, he’ll bring home about $250 after 9-11 hours of work, he said.

Castillo gets paid per ride and his earnings depend on how long the trip is, how much distance he covers and whether or not there’s “surge pricing,” when demand for rides is high and prices for passengers go up. Surge pricing, or “prime time,” as Lyft calls it, tends to happen during rush hour, bad weather or if there’s a big event going on in the area.

He can also earn tips. While just 20 percent of passengers leave tips, he estimated, “it helps. Every money helps.”

The app doesn’t show how much the customer paid, Castillo told me — it just breaks down his take per ride. A mid-morning, 22-minute UberX trip earned him nearly $10: He earned a base rate (what you’re paid to start the ride) of $1.83, a time rate (what you earn per minute in your region) of $5.49 and a distance rate (what you earn per mile in your region) of $2. Total: $9.32.

Uber and Lyft both collect about 30 percent of all passenger fares, Castillo told me. Juno takes just 16 percent, but as an app it’s not as popular yet, he added. Sure enough, we didn’t get one call from Juno over the course of the day and, instead, flipped back and forth between Uber and Lyft.

Still, he has all three because, depending on what neighborhood he’s driving in, one app may be busier than the others. “People in Bed Stuy like to use Lyft,” he said. “If you’re in Queens, people like Juno.”

If Castillo earns $250 a day and works Monday to Saturday, that’s $1,500 per week, which comes out to about $6,000 a month. He earns an additional $100 to $300 per month by using Cargo, which pays him a monthly rate for selling products like snacks and headphones to passengers, and Play Octopus, which pays him to mount a tablet that offers trivia games and plays ads.

That means he could be earning about $72,000 a year from rides and between $1,200 and $3,600 a year from Cargo and Play Octopus, for a total of about $75,000. That’s before taxes, though, and doesn’t factor in expenses like gas, insurance and maintenance, which can add up to nearly $20,000 a year.

Besides expenses, a driver’s take home pay will also depend on where they’re located, as mileage and per-minute rates vary by city.

And some days, you’re going to get luckier than others, Castillo told me. On his best day, he took home $540 after nine hours of driving, thanks to surge pricing. One-fifth of that came from a single, lucrative trip to the airport: “It was snowing and it was ugly outside. It was like 5:30 or 6 p.m., peak hours. They paid me like $110.”

Another time, after completing a $20 ride, Castillo recalled, the passenger gave him “a $100 tip, because it was Christmas.”

Just an FYI in case this comes up on the BBC tomorrow, Saez/Zucman theorize on how to implement Warren's proposed wealth tax Emmanuel Saez and Gabriel Zucman, "How would a progressive wealth tax work? Evidence from the economics literature," University of California, February 5, 2019, https://eml.berkeley.edu/~saez/saez-zucman-wealthtaxobjections.pdf