A few months ago the Senate Democrats here in the State of Wisconsin floated a plan to provide universal health care for all residents of the state. The first question most will ask is “who is going to pay?” The answer is that the plan ($15bb worth) will be funded through a payroll tax.
The plan is dead in the water as the Republicans who control our State Assembly are having nothing of it, but in the next election there is the distinct possibility that the Democrats will win back the Assembly, and will then control the Governor’s chair, the Senate and the Assembly.
This is the type of thing that causes business owners like myself nightmares. I already provide top notch insurance coverage to my employees and their families. If I am forced to pay a huge payroll tax to provide insurance, it is a mere formality that the very good coverage that my employees currently enjoy will go away. In other words, I will be damned if I am going to pay twice.
Add to this that my business crosses state lines, with part of the employees residing in Illinois. It is completely unfair that they receive the good coverage, while the employees in Wisconsin will have to deal with the inevitable bloated bureaucratic mess that the state health plan will become.
But life isn’t fair, and the employees will have to understand that. The good news for me is that I won’t have to worry about them scurrying off to other employers – everybody will have the same coverage. The bad news is that these are my friends and some are long time employees that I care about and I just know that they are going to get shafted by the State of Wisconsin someday for something. I guarantee my tiny business isn’t the only one that will have to struggle to make things fair and/or equitable for employees.
On a personal level, I have already started to look into alternatives to the state health plan. First and foremost I am making good personal decisions (less alcohol, more exercise, watching my weight). If I am not sick, I don’t have to go to the doctor, and won’t have to deal with the nightmare to come. Secondly, I have begun to look into private insurance, or perhaps becoming a resident of another state while living here in Madison. Frankly I am hoping that I won’t have to cross this bridge any time soon.
Episodes like this always make me think of Bastiat and this essay. Even though it was written 159 years ago it is always timely. The thrust of it is that “the bad economist pursues a small present good that will be followed by a great evil to come…”. The first paragraph:
In the economic sphere an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we forsee them. (bold mine)
I don’t have any answers to the health care problems we all have, and would love some realistic solutions from somewhere. That cost on my business that happened courtesy of WW2 is one of my largest. I do know one thing – if the solution is done courtesy of the State of Wisconsin there will be calamity.
I sincerely hope that if the Democrats gain control in ’08 that this plan will not pass in its present form. But if it does, the unseen future effects on the economy of this state will be severe.
Cross posted at LITGM.