Bryan Caplan  

Why Liberals Needn't Fear Republican-Run Welfare States

Krugman on Canadian Health Car... Arlo Guthrie Says TANSTAAFL...
Mankiw riddles Krugman this:
Over the past eight years, Paul has tried to convince his readers that Republicans are stupid and venal. History suggests that Republicans will run the government about half the time. Does he really want to turn control of healthcare half the time over to a group that he considers stupid and venal?
A priori, it's a tough question.  Empirically, though, it's undaunting.  Republicans might be a little more inclined to hold down the rate of growth of Medicare.  But since its passage, both parties have run the program almost identically.  The same holds for other big, popular tent poles of the welfare state like Social Security.  If history is any guide, all Democrats need to do to ensure permanent bipartisan support for Obamacare is pass it.  As Roosevelt put it, "no damn politician can ever scrap my social security program."

Notice: In other areas, especially foreign policy, things don't work this way.  Bush II invaded Iraq and winked at torture; Gore probably wouldn't have.  Clinton invaded Haiti; Bush I probably wouldn't have.

One can note these differences without being able to explain them.  But I think I've got a good explanation.  Here goes:

In a simple median voter model, it never matters which party is in control.  Whoever runs the government does as the median voter commands.

In the real world, however, politicians often have some political slack - a range of electorally safe options.  They can use this slack is all kinds of ways: To pursue their own vision, to sell out to special interests, to cheat on their wives, whatever.

Question: Where does slack come from?  The main answer: Slack exists insofar as the median voter is roughly indifferent.  (Imperfect information, contrary to conventional wisdom, does not imply slack; rationally ignorant voters could easily discipline politicians with Beckerian punishment strategies).  Politicians can safely do A instead of B as long as voters are - out of apathy or deference - indifferent between them.

OK, so what's the difference between health policy and foreign policy?  For health policy, the median voter has fairly specific preferences.  He knows he likes giving free medicine to the American elderly, he knows he hates rationing, and he knows he doesn't want to listen to fiscal Cassandras.  Hence, the political juggernaut that is Medicare.  For foreign policy, in contrast, the median voter has a big range of indifference.  If the President says we need to invade Iraq, he'll go along with it for a couple years at least; if the President says Iraq isn't a problem, the median voter will go along with that, too.

Bottom line: Libertarians should fear government-run health care no matter who's in charge.  For liberals, however, it doesn't make much difference.  As long as public opinion is firmly on your side, it doesn't matter who runs the government - venality and stupidity notwithstanding.

Comments and Sharing

COMMENTS (10 to date)
E. Barandiaran writes:

Bryan, unfortunately the Argentinian experience supports your last sentence about liberals. In particular, the levels of venality and stupidity appear not to make any difference.

RobB writes:

Not to get stuck on a side issue, but I disagree that Gore would probably not have invaded Iraq. I think he probably would have.

He would have still been stuck with a failing sanctions regime, no fly zones, and Kurds relying on US forces for protection.

He still would have had US and European intelligence agencies reporting that Saddam was trying to reconstitute a WMD program including nukes.

As the previous Vice-President, he would have had to shoulder significantly more responsibility for the 9/11 attacks than Bush - who could plausibly claim little responsibility for not detecting/stopping the attacks and no responsibility for failing to respond adequately to earlier attacks.

And he would have been eager to counter the public perception that Democrats are softer on defense than Republicans.

Given all of the above factors - I suspect Gore would have been just as hawkish as Bush. It may be difficult to remember now, but in 2002 invading Iraq was a popular move supported by a majority of Democrats including a lot of former Clinton foreign policy hands who may well have still been in a Gore administration.

Thomas DeMeo writes:

I think you are correct except for the fiscal Cassandra part. That is demonstrably false.

The problem for some time has been that Republicans cut taxes, but don't cut any government.

sammy writes:

As long as public opinion is firmly on your side, it doesn't matter who runs the government - venality and stupidity notwithstanding.

This strikes me as an incorrect argument. Liberal Krugman thinks liberals will do a good job with health care administration, but it is foreseeable that people who oversaw Katrina might come to power. what happens then? does Krugman believe that in their hands would public health care still be a better option compared to private healthcare is Mankiw's question.

Max writes:

For Krugman, certainly it would make a difference (perhaps all the difference?), but for the general liberal? No way, but this cuts both ways, or did anyone see the Patriot Act gone out of the window now that the Democrats are in power?

No? That's because specifics aside none of the both parties (or any political party as a whole) would want to abolish something that has given them more power, even if it is inefficient. In my life-time I have seen perhaps two institutions being cut here in Germany: The Post Office and the Energy companies (both having been privatized), but never have I seen the government cut anything at all in their departement. The people who clean chimneys, they still come to every house and get paid for doing nothing at all, because there are no longer any chimneys.
Is this inefficient and useless and costly? Yes!
Will it get cut? No, at least not as long as the country exists in this fashion...
There have been made additions and changes, but never got a whole departement abolished or the size of the state reduced.

Floccina writes:

If Robin Hanson is correct and much of healthcare is done just to show caring socialized medicine should be a huge plus for the democrat party. It will be taken as a sign that democratic politicians care about people. People may love socialized medicine no matter if it is bad or good.

Bob Hawkins writes:

Another way of looking at it is, in foreign policy, the President can "pass the law" pretty much by himself. Consider that Obama has handled Bush's Iraq War policy much the way Republicans handle FDR's Social Security policy.

And a sample of 1 is inherently much more variable than a sample of 435 or 100.

Methinks writes:

That's because specifics aside none of the both parties (or any political party as a whole) would want to abolish something that has given them more power, even if it is inefficient.

BINGO! And nothing puts one at the mercy of the politicians more than having to go hat in hand to beg for health care when the wait list for your chemotherapy is 12 months long. Just imagine how much power that gives politicians. Just imagine how much that power would be worth when sold to the highest bidder! The constitution can be made a distant bad memory for politicians just by passing this bill. Also, imagine that if the government pimply-faced clerk who has to okay your treatment doesn't like your attitude he could "lose" your request and never fear being fired from his public union protected job.

Government meat grinder care may be inefficient for the population, but it's perfectly efficient for politicians.

David C writes:

Could you elaborate on what you mean by your claim that "ignorant voters could easily discipline politicians with Beckerian punishment strategies"?

Joe writes:

If libertarians should not care, why do they sympathize with repulicans in corporate welfare vs. individual welfare?

Libertarians should despise them both, but tend to prefer republicans?

Why? Or are they not really libertarians?

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