So What Could we Lose in Health Care Savings?

The Los Angeles Times reported today that "President Obama, joined by an array of groups pledging to cut the cost of health care, said today the commitment that insurers, hospitals, doctors and others have made to saving money will help him achieve the health care reform he is pursuing on Capitol Hill."

The Washington Times has taken a rather dismissive tone to the actions, stating "The pledge provided few specifics on how the costs savings would be achieved or monitored. And many industry groups remain fiercely opposed to a central plank of the Obama health reform plan — the creation of a publicly funded health insurance plan to compete with private insurers and ensure universal health coverage."

Many will argue, including this writer, that any such pledges by the health care industry will likely be more verbal than monetary. This is all the more the case when you factor in the huge amounts of money the industry will have to spend to fight the Administration's socialized medicine program.

This government-private "collaboration" has problems on several levels:

• Where does an administration that has spent more in 100 days than any Administration up to Ronald Reagan spent in their entire terms, have the right to lecture anyone on fiscal responsibility?


• These dollars are being spent on something and there are always trade offs. Will the proposed $2 trillion come from cutting waste and bureaucracy? Or will it come from innovation, salaries, patient care, and other legitimate functions of health care.


• The fundamental question of the "role of government" is again, completely ignored in this "agreement."

Right now this agreement is little more than another example of Obama attempting to do "something," even if it results in little or nothing. It is an example of rhetoric without substance. The solution to America's health care problems will be found in the market place. At some point, that is where Obama needs to seriously search. What works in our economy are things like competition, reasonable risk, innovation, and economies of scale. These are found in the market, not in the government.

Kevin Price is Host of the Price of Business, the longest running show on AM 650 (M-F at 11 am) in Houston, Texas and on AOL Radio. Eric Bolling of Fox News and Fox Business says that Price’s Blog “is very influential and moves the blogosphere.” Steve Moore of the Wall Street Journal calls Price the “best business talk show host in the country.” Find out why and visit his blog at www.BizPlusBlog.com and his show site at www.PriceofBusiness.com. You can also find Price on Strategy Room at FoxNews.com.

Gramm is Largely Correct

Former Senator Phil Gramm, who had an excellent career in the US Senate fighting for the prosperity of Americans, recently spoke his mind about the economy with candor and intelligence. Sen. Gramm is not only a former member of the House and the Senate with over two decades experience, but also has a PhD in economics from the University of Georgia. He may very well be the "Dr. Phil" of economics.

In an interview with the Washington Times, Gramm stated:

You've heard of mental depression; this is a mental recession," he said, noting that growth has held up at about 1 percent despite all the publicity over losing jobs to India, China, illegal immigration, housing and credit problems and record oil prices. "We may have a recession; we haven't had one yet."

"We have sort of become a nation of whiners," he said. "You just hear this constant whining, complaining about a loss of competitiveness, America in decline" despite a major export boom that is the primary reason that growth continues in the economy, he said.

"We've never been more dominant; we've never had more natural advantages than we have today," he said. "We have benefited greatly" from the globalization of the economy in the last 30 years.

He goes on to point out that "Misery sells newspapers. Thank God the economy is not as bad as you read in the newspaper every day."

These themes have been a part of my mantra, with titles such as Economist on the Media and Recession, Bad News Means Big Business for CNBC, and others with similar titles for the last two years, the criticism against Gramm seems to me to be unfair.

But criticized he has been and practically thrown under the bus by Sen. John McCain for whom he has served as an economic advisor. Threatening to send Gramm to Eastern Europe as an ambassador if elected and if they would have him, McCain is using the harshness he has become famous for in his ability to turn on a friend.

It is true, there are people in this country who are suffering at this time. However, most of those are the same people when are economy was incredibly hot a few years ago. Gramm's statements are largely true but probably too honest in an election cycle. The media lives off of bad news and the people are beginning to buy the headlines.

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Kevin Price is Host of the Houston Business Show (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at HoustonBusinessShow.com. Visit the archive of past shows here.