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“Cash for Clunkers” and Obamacare

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The government’s $4,500 incentive to trade in an old car and buy a new one blew through its $1 billion in a week.

Just as with the tax credit for new home purchases, consumers altered their behavior when presented with an opportunity. Democrats thus have received a second example of an iron law of economics: People respond quickly to significant cash incentives.

Which is why the “government option/public plan” will quickly kill private insurance if it is enacted, and why the president should not be routinely “guaranteeing” that if you like the insurance you have, you can keep it.

If the government establishes a program that makes it cheaper for employers to dump their employees into the “government option,” they will. Just like buyers who responded to tax credits for new homes or cash-back for old cars, employers will respond to large bottom-line incentives.

A “government option” will work quickly and effectively to cripple private insurance. It is “single payer on the installment plan,” and that’s why Americans are turning against it by the millions, and telling Congress as much.

It is also why columns like today’s by Paul Krugman are so fundamentally dishonest: They don’t tell you the truth about Obamacare, which is that it will cause millions of Americans to lose the insurance they presently have. Over and over again voices from the president down and all across the left tell you how terrible private insurance is, but the vast majority of Americans with private insurance want to keep it. Yes, there are horror stories out there about bad insurance companies refusing to pay good claims –and that’s why the tort of wrongful denial of coverage is such a powerful one. Juries hate insurance companies that refuse to pay for treatments they have agreed to cover, and the verdicts that follow proof of such a denial are large as a result. When the government takes over your insurance and refuses to pay for a treatment, good luck threatening that bureaucrat with a lawsuit.

Most Americans want to keep the insurance they have. Most Democrats in Congress and the president want to take it away and replace it with a government policy. That’s the big divide in D.C., and it is the reason you have to act between now and the return of Congress in September if you want to be certain of staying out of a government insurance plan. (See Kimberley Strassel’s excellent piece in the Wall Street Journal to glimpse the ongoing battle within the Democratic Party between the Obama-Pelosi-Waxman left and the “moderate” Democrats.)

This weekend and throughout August, contact members of the Blue Dog Democrats and tell them to turn down Obamacare. (The list of Blue Dogs with their contact information is here.)

And then tell your senators via 202-224-3121. When you have called both of your home state senators, contact these Democratic senators who are facing re-election in 2010 and tell them that if they support Obamacare, you will work for their opponents and contribute to their opponents’ campaigns:

Arkansas’ Blanche Lincoln

New York’s Kirsten Gillibrand

Indiana’s Evan Bayh

North Dakota’s Byron Dorgan

Colorado’s Michael Bennet

Pennsylvania’s Arlen Specter

Oregon’s Ron Wyden

Washington’s Patty Murray.

If you haven’t done so already, please sign the petition to stop Obamacare. If you have already signed, send the URL to friends, family and colleagues and ask them to sign.


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