Health Care
Floor Speech
BREAK IN TRANSCRIPT
Mr. THUNE. Mr. President, I rise also to speak to the issue of the health care reform bill, which my colleague from Arizona has pointed out is now seeing its 1-year anniversary. I think it is good to put in perspective the issues most Americans care about.
As I travel my State of South Dakota and elsewhere in this country, I hear repeatedly what most Americans think we ought to be focused on right now in Washington, DC; that is, the economy, job creation, spending, and debt. They believe those are the issues that are most important. I think the public opinion polls reflect that. If we look at any public opinion poll today, generally, they are in that order: It will be jobs, the economy, spending, and debt.
As I look at what this health care bill has done--and use the metric of jobs and the economy and spending and debt and look at it on the 1-year anniversary--I think we would have to say this has been a major failure in terms of speaking to or addressing the issues the American people care the most about.
On the issue of jobs and the economy, there were lots of statements made about this when it was passed; that it was going to create lots of jobs. The former Speaker of the House, Nancy Pelosi, said, in its life, the health care bill will create 4 million jobs; 400,000 jobs almost immediately. Yet we have the CBO Director recently testifying that the new law will reduce employment over the next decade by 800,000 jobs.
So we have a piece of legislation that is going to, according to the CBO, cost us jobs in the economy. Couple that with the fact that it will raise taxes, and raise taxes dramatically on the economy, by $ 1/2 trillion in the first 10 years, $1 trillion dollars when it is fully implemented, and we see that businesses will pass those costs on to the people in this country who buy things--consumers--and, obviously, it leads to higher costs for a lot of these items.
It leads to higher health care costs because most of those taxes were imposed upon health insurance companies, on pharmaceutical companies and on medical device manufacturers and many of those costs are being passed on. One would have to argue very hard to suggest that any kind of a tax increase is going to create more jobs. In fact, historically, it is very clear that any time we raise taxes, it actually costs the economy jobs.
So we have the CBO Director talking about the loss of jobs, we have the fact that we have some massive tax increases in this legislation that will cost us jobs, and we also drive up the cost of doing business in this country because we are increasing the cost of health care for a lot of small businesses that are trying to provide coverage to their employees.
What we have seen consistently is an argument from the other side that this was going to drive down the cost of health care. Yet, again, the facts tell an entirely different story.
There was a statement made by the President: Reform will lower the cost of health care for our families, our businesses, and our government. Again, the Chief Actuary at the Centers for Medicare and Medicaid Services estimates the law will increase costs by $311 billion in the first 10 years alone, over and above normal inflation. CBO, the Congressional Budget Office, estimates the new law will increase health care spending by the Federal Government by $464 billion over the next decade. CBO estimates when it is fully implemented, the law will increase insurance premiums on a family policy by an average of $2,100 per year--increased costs of health insurance for employers and employees, which is going to cost the economy jobs. It drives up the cost of doing business in this country. All these factors in this health care legislation contribute to a loss of jobs because they make it more expensive for small businesses in this country.
If you use the metric of job creation and how this legislation impacts the economy, I think you would have to describe it as a major failure. The American people determine what is important. They have decided, and rightly so, when you have as high unemployment as we have in this country today, job creation should be the No. 1 priority of their policymakers in Washington, DC. In fact, we should be looking at policies that will be conducive to job creation, not policies that will inhibit job creation. The massive health care law that was passed last year will have exactly the opposite effect we should be striving for when it comes to jobs. We ought to be looking for policies that will create jobs. This actually will cost the economy jobs. You have the metric of job creation. If you measure the health care bill against that a year later, I think you would have to say it was a complete failure.
The issues I mentioned that also bear on what is important to Americans today, spending and debt--how does health care legislation stack up against those criteria? First, with regard to spending, we all know by now that when it is fully implemented this new health care legislation will cost $2.6 trillion, a $2.6 trillion expansion of government--literally the largest expansion of the Federal Government in the last half century. You would have to go back to the 1960s to find a time that you see the government expand at the rate we have seen in the last 2 years alone, and that is reflected in the debt and deficit figures over the last 2 years.
Since President Obama took office, the debt in this country has grown by over $3 trillion. In fact, if the budget he presented is implemented, that total debt will double by the end of the next decade. If you take a $14 trillion gross debt, almost $14 trillion--which is where it is today--if the President's budget is implemented you would see that debt double over the course of the next decade to over $26 trillion.
You have massive amounts of borrowing, massive amounts of debt, massive amounts of new spending and tax increases, all of which create an environment in which it is going to be very difficult for our economy and for the job creators to create jobs. But you have grown significantly the size of government.
How about the issue, as I said earlier, of debt? We talk a lot about the $14 trillion gross debt we have today. We have a lot of research out there that suggests when you are carrying that kind of debt load, if you sustain it over any amount of time it is going to cost you a significant amount of economic growth. In fact, there is a good body of research out there that suggests when you have a gross debt-to-GDP ratio of 90 percent or higher, which is where we are today, it costs you about 1 percent a year.
The President's former economic advisor, Christina Romer, said anytime you lose a percentage point of economic growth it costs you a million jobs. If we are losing, because of this high level of debt, a percentage point of economic growth every year, we are losing a million jobs every year as a result of that as well.
How does the whole health care debate bear on this issue of debt in the long term? I think it is important, again, to point out that many of the things that were put into this bill, that were designed to be used as offsets to pay for the bill, end up in the outyears adding massively to the deficit. I will use a good example of that, the CLASS Act, a new long-term care entitlement program which was put into this bill. At the time it was being debated it was actually described by the chairman of the Budget Committee, the Democratic chairman, as a Ponzi scheme of the highest order, something Bernie Madoff would be proud of. That is how the CLASS Act was described. That particular act, and its creation, was used as a $70 billion offset to pay for the new massive health care entitlement program.
What is going to happen, and we are finding out now more and more about this, is that particular program, although it generates some revenue in the early years, runs huge deficits when you get into the outyears because of the way the program is structured, because of adverse selection. Because of the way the program was designed in the first place you start adding massively to deficits in the outyears. Secretary Sebelius, at the Department of Health and Human Services, admitted to me in answer to a question at the Senate Finance Committee, that the CLASS Act program is ``totally unsustainable.''
During yesterday's Finance Committee hearing I asked the question about whether there was actuarial modeling done prior to the law's passage so that Democrats and Health and Human Services would have known how bad this program is, and she would not respond to or answer that question.
I asked Chairman Conrad, the chairman of the Senate Budget Committee, for a hearing to look at these actuarial models that Health and Human Services has developed to analyze the CLASS Act. Why has she come to the conclusion that it is totally unsustainable when many of us knew that in advance? In fact, that is what CBO, the Congressional Budget Office, was saying in advance.
We have created these new entitlement programs that are going to lead massively to higher deficits and more debt well into the future, the CLASS Act being one example of that. I suggest as well that when you create a $2.6 trillion new entitlement program, if history is any indication, that would dramatically understate what the true costs are. We have seen that historically, that whatever the estimates are about some of these new government programs, they are significantly less than what was estimated when they were created in the first place.
I would argue on the issue of how the new health care bill on its first anniversary impacts the issue of debt, we are not going to know probably for some time but I think we can get a pretty clear idea that this is going to lead to much higher deficits and much higher debt in the outyears because of the statement the Congressional Budget Office and the CMS Actuary and even now the Secretary of Health and Human Services are saying with regard to programs such as the CLASS Act--which was created under this bill.
I think the other reason you are going to see the debt and deficit explode is because of the gimmicks that were used by the Democrats to finance the health care bill. I mentioned the CLASS Act was one of those, but there were a number of other gimmicks that were used as well. There was the Medicare payroll tax increases, the Medicare cuts that are supposed to occur under this to pay for the new health care entitlement program. It was also indicated at that time they were going to extend the lifespan of Medicare. Essentially, what happened is the same revenues were spent twice; they were double counted. In other words, there was new revenue going to come into the Medicare trust fund because of increased payroll taxes and because of the reductions in spending in those Medicare accounts that allegedly would create a credit for the Medicare trust fund. Unfortunately, all those new revenues are going to be used to finance this new health care entitlement program.
Somewhere down the road, when the time comes to pay the bills of Medicare, you are going to have to borrow money to do that because of the way these gimmicks were used and the way the double counting was used, not only to credit the
Medicare trust fund but also to use it as an offset for the new health care entitlement program.
If you look at the actual numbers it is somewhere on the order of $400 billion that was double counted in the Medicare trust fund and about $30 billion, I believe, was the number on the Social Security trust fund. For these gimmicks, the chickens are going to come home to roost at some point in the future and it is going to lead to significantly larger deficits and a much higher debt than we are looking at today, than what was contemplated when the legislation was passed in the first place.
Whether it is the gimmicks that were used, whether it is these new entitlement programs such as the CLASS Act, whether it is the actual cost--even estimated cost of $2.6 trillion in new expansion of government, whether it is the loss of jobs associated with the higher taxes, the higher health care premiums in this legislation, if you are going to evaluate it based upon the issues that are most important to the American people--and that is the economy, jobs, spending, and debt--on the first anniversary of this health care reform legislation, this has been already a huge failure by any objective measurement. My guess is before this is all said and done we are going to continue to see more and more of our employers having to drop their coverage, perhaps pay the penalty rather than continue to provide coverage for their employees, and push them into the government program.
I think you are going to see more and more government control, more and more influence and intervention of the Federal Government, more and more cost to taxpayers, and higher and higher health care costs for small businesses and for families and for individuals in this country. On the first year anniversary of this legislation, I think the best thing Congress could do would be to repeal it and start over with commonsense health care reforms that will actually reduce the cost of health care, that will be fiscally responsible, that will not break the bank, and that will help get us on a path where we can create jobs and get the economy growing again rather than inhibiting that.
I yield the floor.
BREAK IN TRANSCRIPT
Source