IPAB

To paraphrase Freud: Liberals, what do they really want? Not the communism or socialism of the right’s fever dreams. They know that didn’t work. Today’s liberal agenda is more akin to the corporatist vision of the 1920s and ’30s​—​an economy in which the state directs the activities of the private sector to achieve ideologically desired ends. But even that description doesn’t quite get to the nub of it. Liberals today seek to create a stable, and what they perceive to be a socially just, society via rule by experts​—​in which most of the activities of society are micromanaged by technocrats for the economic and social benefit of the whole. In other words, social democracy without the messiness of democracy, like the European Union’s rule-by-bureaucrats-in-Brussels. This is the “fundamental transformation” that President Obama seeks to implement in this country.

The siren song of technocracy attracts members of both parties. Left-wing types tend to believe in issuing direct government commands. Think Nancy Pelosi or Mayor Bloomberg. Big government right-wingers prefer to induce “desirable” behavior through incentives. Think Newt Gingrich at his most utopian.

Since technocrats believe their job is to protect us from ourselves, preventing people from getting hurt becomes the prime directive, the equality that matters most is equality of outcome​—​not opportunity​—​an unattainable goal, which conveniently means a technocrat’s work is never done.

Europeans generally accept this benign statism as the best way to maintain peace and social stability. It has been somewhat rougher sledding in the United States because technocracy undermines individual liberty and the American dream. Hence the widespread outrage over “You didn’t build that.”

But with the coming of the Affordable Care Act (ACA), aka Obama­care, the technocrats have broken ground for a full-bore, EU-style bureaucratic state. Leading the charge is the Independent Payment Advisory Board, governed by 15 “experts” appointed by the president and confirmed by the Senate. Established to control Medicare costs, IPAB possesses the raw power to force Congress to legislate via its “fast track authority”; IPAB’s financial targets must be enacted into law by August 15 of each year, beginning in 2014. Not only that, if Congress refuses to legislate the level of cost containment demanded by IPAB (or if the president vetoes the bill), IPAB’s original recommendation is automatically imposed. In other words, IPAB’s cost-cutting word is law. And if that isn’t enough: Congress can’t dissolve IPAB until 2017​—​and then only by a supermajority vote of both houses.

Defenders of IPAB claim that such extraordinary authority is necessary because Congress can’t be trusted to cut costs. We should never underestimate Congress’s cravenness, but that is no reason to bulldoze democratic accountability or devolve power from the elected organs of government to a semi-sovereign bureaucracy.

Defenders also tell us not to fear because IPAB’s cost-cutting weapons are limited primarily to controlling payments to doctors and hospitals​—​never mind that draconian cuts in compensation could make it extremely difficult for Medicare beneficiaries to find doctors. But the broad power given to IPAB was not designed to remain limited. Even before it is up and running, President Obama has said that IPAB should be “strengthened.”

More specifically, Christina Romer, the former head of the president’s Council of Economic Advisers, suggested in a July 22 column in the New York Times that IPAB “could be empowered to suggest changes in benefits or in how Medicare services are provided,” once it has a “track record”—meaning, once it becomes an accepted reality. But as we have seen, IPAB doesn’t merely “suggest,” it dictates. Thus, Romer is actually arguing that IPAB could eventually be granted absolute authority over Medicare policy, including, perhaps, health care rationing power that would be the envy of any EU technocrat.

Former Obama Treasury Department adviser and New York Times columnist Steven Rattner specifically urged transforming IPAB into a rationing board in a September 17 column. “No one wants to lose an aging parent,” he wrote. But the cost of caring extensively for the elderly “imposes an enormous societal cost that few other nations have been willing to bear,” and so we too must jump into the rationing pool:

Take Britain, which provides universal coverage with spending at proportionately almost half of American levels. Its National Institute for Health and Clinical Excellence uses a complex quality-adjusted life year system to put an explicit value (up to about $48,000 per year) on a treatment’s ability to extend life.

So the liberal punditry woke up today to find that PolitiFact has declared the "Lie of the Year" to be Democrats's claim that Paul Ryan's budget will "end Medicare" or "end Medicare as we know it." They're having quite the collective freakout—see Paul Krugman, Jonathan Chait,

In his health care speech at the Hoover Institution, Paul Ryan not only laid out his plans “to confront health care inflation head-on” but also discussed President Obama’s approach to dealing with rising health costs, which mostly amounts to price controls imposed by an ominous, unelected, quasi-legislative board. Here’s what Ryan had to say about Obama’s approach: