- The Washington Times - Monday, July 1, 2002

Back in 1994, when the Democrats held a majority in both chambers, Congress thwarted President Clinton and Hillary Rodham Clinton's power grab for control of America's health system. Since that political fiasco, advocates of a governmental takeover have shied away from such sweeping "reform" schemes, preferring instead to push for incremental steps toward more federal control.
But the House of Representatives' passage of the massively expensive prescription drug bill (expected to cost upwards of $320 billion over the next 10 years alone), which Republican leaders rammed through at 2:30 a.m. Friday morning, brings a jarring conclusion to the era of "incrementalism." On Capitol Hill, Democrats and Republicans have kicked off a political bidding war which is likely to result in the creation of the largest new entitlement program since LBJ rammed his Great Society initiatives through Congress in the 1960s.
Even without a new prescription-drug entitlement scheme, Medicare and its sister program, Medicaid, (the federal health entitlement program for the poor) have been growing like Pac-Man with no end in sight. Writing in the Commentary section of The Washington Times last week, economist Bruce Bartlett noted that in 1960, Washington spent virtually nothing for health care; today, federal health-care costs are 3.4 percent of GDP and nearly $400 billion a year.
And the future looks even worse. According to the Congressional Budget Office (CBO), Medicare alone will rise to 9.9 percent of GDP by 2075; overall federal spending, CBO estimates, will more than double its share of the nation's economy, reaching 42 percent of GDP by 2075. And that's under current law, before Congress enacts any prescription-drug bill.
Both the Democratic and Republican bills currently before Congress will further exacerbate the problem. Judging from the "fact sheets" distributed by the Republicans, everyone, regardless of income, would be eligible for their glorious new entitlement. So, even Bill Gates' family would benefit. Thank goodness that the Republicans have managed to solve that pressing social problem.
The Senate Democratic alternative, which Majority Leader Tom Daschle is pushing, would cost between $400 and $500 billion for starters. The most fiscally irresponsible measure of all is the version being pushed by House Democrats like Rep. Frank Pallone and Minority Leader Dick Gephardt, which would cost more than $800 billion over the next decade, and could well be revived if the Democrats regain control of the House in November. If the history of Medicare and Medicaid (which were originally projected to cost next to nothing) is any indication, the actual expense of a new drug entitlement will be stratospheric.
Beyond the direct cost to taxpayers, these programs help dry up the market for new drug research in this country: By heavily subsidizing drug purchases, they will almost certainly trigger a vast upsurge in demand, one that is likely to lead to some form of price controls, like those which have undermined Europe's drug-innovation efforts. Grace-Marie Turner of the Galen Institute, a research organization which supports free-market health care reforms, writes that from 1975-94, the United States developed 45 percent of new major drugs, while European nations like France, Germany and Britain, with much greater state roles in subsidizing and dictating health-care choices for consumers, lagged far behind. President Bush would be well-advised to veto any prescription-drug entitlement measure that reaches his desk.


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