Home America Now Why Health Care, Social Security and Other Big Government Programs Are Resistant to Change

Why Health Care, Social Security and Other Big Government Programs Are Resistant to Change

by Richard A Reagan

As the debate over health care reform continues in Congress, frustration continues to build up on all side of the debate. Congressional Republican leadership would like to see a quick resolution and passage of their legislation. Hardcore opponents of Obamacare want to see the bill repealed and replaced with something better. And Democrats are fighting tooth and nail to maintain one of the key achievements of President Obama’s tenure. But if passing legislation is just a matter of getting enough votes behind your position, why is it taking so long?

Concentrated Benefits, Distributed Costs

The major problem with trying to reform or repeal just about any government program is that the benefits of those programs accrue to a relatively small number of people, while the costs are distributed over a large number of people, many of whom may not even notice it.

If every American had to pay $1 more per month in taxes, most would hardly notice it. But that’s near $3.9 billion in extra tax payments. Now imagine that that money goes to 1,000 different companies who benefit from some government program. That’s $3.9 million per company. Now imagine that Congress wants to cut that program. All 1,000 companies will lobby Congress to say how vital the program is to their business. How many Congressmen do you think would want to go on record saying that they’ll vote to eliminate a program that helps 1,000 businesses? Not very many.

Of the 320 million people in the United States, how many do you think will contact Congress demanding to cut that same program to cut their tax bill by $1 per month? Probably very few. Their voices won’t be nearly as loud or as focused as the companies that benefit from the program because the cost of the program to them just isn’t that much.

Of course, most government spending operates like this, adding incremental amounts to the budget to gain votes or support from key constituencies while spreading the costs over the whole country. But eventually, those individual increases start to add up. A few billion here and a few billion there and pretty soon you’re talking real money.

Obamacare and Social Security

In the case of Obamacare, the benefits are to the millions of people who couldn’t get health insurance either because they couldn’t afford it or because they had pre-existing conditions. The costs for those people to get insurance are then placed on the hundreds of millions of others who already had health insurance. But when it comes to trying to reform the health care system, one side will point out heart-wrenching stories of children with severe illnesses whose families risk losing their health care if Obamacare is repealed, while the other side points out rising health care premiums that will cost families thousands or tens of thousands of dollars more per year. Guess which side will win that battle of the heartstrings?

Social Security is much the same. The people who are reliant on Social Security are often low-income retirees. Cutting their benefits would in many cases mean that they would have to cut back significantly on food, housing, or medical care. On the other hand, the fiscal problems with Social Security will require younger workers to pay higher taxes in the future in order to keep the current level of benefits. Again, the benefits of Social Security are concentrated among a smaller number of people while the costs are spread out.

That is why it is next to impossible to get any real reform of any government program. As soon as you try, those who benefit from the program complain about the harm it will cause them. Those who are harmed by the program are too widely dispersed to mount an effective campaign, and so things go on as they always have. The lesson, then, is that if you want to make any successful effort at reform you have to minimize the impact to the people who stand to lose out from reform measures and galvanize those who are currently being impacted negatively to make their voices heard.

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