The Courage Primary

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Universal Health Insurance
This issue has been talked to death for the past 20 years, but there is now a significant change in the political landscape that makes an imminent solution possible: not the ever rising numbers of uninsured Americans, now estimated at 47 million, but corporate America's impatience with the back-breaking financial burden of providing health insurance for its employees. Health care adds $1,500 to the price of every new American car, for instance. "I've had auto executives say to me, ‘We're health-care companies that happen to make cars,'" says Senator Ron Wyden of Oregon. As it happens, Wyden has put an elegant and entirely radical health-care plan on the table. According to an independent assessment by the Lewin Group, a nonpartisan health-care consulting firm, it would save $1.48 trillion over the next 10 years.

Wyden would eliminate the current employer-based system. Employers would "cash out" the money they currently pay for health benefits and distribute it as wages; individuals would then pay for their own health insurance—an annual premium to the Federal government, as part of their income taxes. They would choose their own private plans from a system very much like the one currently offered federal employees. But there would be two mandates: one for individuals and one for insurance companies. The individual mandate would require everyone to participate, especially those who can afford health insurance and choose not to buy it. (By most estimates, these mostly younger people represent one-third of the 47 million currently uninsured.) The destitute—those who receive Medicaid—would join the same system as everyone else; their health-care premiums would be paid by the government. The lower middle class—that is, people who make up to 400% of the federal poverty level—would have their health-insurance payments subsidized on a sliding scale according to income. The second mandate would require insurance companies to cover everyone who applies and charge them the same amount, regardless of pre-existing conditions. (This is called "community rating" in the trade.)

So where's the pain? Up the income scale. Health care would no longer be tax deductible. Those with incomes of more than 400% of poverty (about $82,000) would have to pay for their health-insurance premiums themselves. And the insurance industry will certainly yowl over what promises to be a more tightly controlled market. Of the major candidates running for President, only Mitt Romney—a Republican—has actually passed a mandatory universal system, in Massachusetts, which subsidizes health-care premiums for the working poor. So far, two leading Democrats, John Edwards and Barack Obama, have proposed universal plans—but both require employers to provide health insurance, as Hillary Clinton did when she proposed her plan in 1993. The details of any plan will be hammered out in the legislative process, but when universal health insurance comes to America, it will probably look more like the Wyden plan than those being proposed by the Democrats. According to the Time poll, 57% of the public favors a universal system of health insurance based on tax credits.

Education
Presidents have very little authority over K-12 education in America. So why even talk about it in 2008? Because the public school system has reached a state of near collapse. The latest results of the National Assessment of Educational Progress show that only 35% of 12th-graders are "proficient" in reading, which means an eighth-grade level of competence, down from 40% in 1992. More than a quarter (27%) of high school seniors are functionally illiterate. The results are even worse in math. Simply throwing more money at the problem isn't the answer. On K-12 we are spending more than double the amount we spent 30 years ago, and the test results are about the same.

The best, if prohibitively radical, proposal to fix this is the report of the New Commission on the Skills of the American Workforce, which draws from an all-star array of education experts from both parties. It would take the funding and much of the control of public schools away from local school boards, give financial and quality control to the states and force each school to become an entrepreneurial competitor for students. It would change the American public school system from one that emphasizes rote learning to a system that encourages and tests for creative and critical thinking. It would establish new incentives—lots more money and more control over teaching methods—to lure the nation's top college graduates into teaching, with bonuses for those willing to teach in the poorest neighborhoods. It would encourage a longer school day and longer school year and would fund universal preschool, and it would do all this, allegedly, for $67 billion less than we're spending on education today. In most of the country, local school boards—especially in affluent communities—would fight a state takeover of funding. Republicans are sticklers for local control. But what would be their argument against an entrepreneurial system, in which students choose among districts, and a curriculum that encourages creativity? In most big cities and their environs, the teachers' unions would rebel. "The teachers' unions want across-the-board raises," says New York City schools chancellor Joel Klein, "but we have to create a system where there's a big financial incentive to teach in poorer neighborhoods like Harlem."

This is a big problem for the Democratic Party, spiritual home of the teachers' unions. But it's about time that teachers were treated like professionals rather than assembly-line workers. Professionals work a full year, and they are paid—and hired and fired—according to their skills and their willingness to do tough jobs rather than seniority. There is a simple test of credibility on education for Democrats. You must be willing to say to the unions, We're with you when it comes to building a floor—the highest possible minimum-wage standard for teachers—but we don't want you building ceilings on merit pay or walls to limit hiring, firing, where and how long teachers teach.

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