"But it'll help corporations": how leftists talk themselves into trashing good, practical, progressive ideas that help people

Wendell Potter

Wednesday was a historic day.

The Senate confirmed Marcia Fudge to be Secretary of Housing and Urban Development, Michael Reagan to be administrator of EPA, and Merrick Garland to be the 87th Attorney General of the United States.

And in the day's main event, President Biden's COVID relief plan, the largest economic stimulus in history, passed both houses of Congress and is now headed to the White House for his signature. The President will sign the bill into law on Thursday, quickly sending out much needed assistance for individuals, families, and small businesses as the nation recovers from a pandemic that was made all the worse by the public health disasters of 'the former guy.'

As I have pointed out here, one of the lesser noticed items in Biden's American Rescue plan is nearly $50 billion in assistance for individuals and families to buy or maintain health care coverage, either through COBRA or by purchasing a health care plan through an Affordable Care Act exchange, which the President has opened up for a special enrollment period through May 15. For those buying through the exchanges, the Biden plan adds enough additional subsidies to Obamacare to make health insurance completely free for families with incomes below $40,000, and it lowers out-of-pocket premium costs for anyone else purchasing insurance through the marketplace.

Good idea, right? More people will save money on health insurance and more people will be able to afford health insurance. What's not to like?

Not so fast, according to the edge of the left seeped in single-payer-or-bust ideology. Wendell Potter, the former insurance executive who became a hero on the left in the last decade by renouncing his former industry and becoming first a public option aficionado and eventually a single-payer partisan, railed against this much needed boost to direct benefits for lower and middle-income Americans. In a Twitter thread on March 4, Potter said the assistance amounts to nothing more than "funnel[ing] money" to his old pals at corporate health insurance companies. He argues that Democrats should have instead used the money to allow people to buy into the "existing Medicare program" instead.

Apart from his white lies about administrative overhead for private insurance - the Affordable Care Act mandates that insurance plans in the individual market spend at least 80% of their premium revenue on actually providing care - Potter's viewpoint represents an irrational, ideological aversion to anything 'corporate' that forces him to see direct assistance to poor and working people as a corporate boondoggle simply because corporations provide the service (in this case, health insurance) purchased with the assistance. Taken to its logical conclusion, as I will demonstrate below, that line of thinking gets pretty absurd pretty quickly. What's worse, Wendell Potter's proposed solution would not actually fix the supposed problem of corporations getting money.

First, let's follow Potter's logic. If public dollars targeted for assisting people to buy something up being spent at businesses that sell that thing makes that assistance itself a corporate bailout, then every government program to help the poor is doomed.

Under this reasoning, any government assistance to poor and working class people is really just a fat check to big business. Nutrition assistance (SNAP benefits) is really a transfer of taxpayer dollars to big agribusiness, Section 8 housing really a windfall for landlords, the Pell Grant a rainmaker for textbook publishers and overpaid college administrators, and the Child Tax Credit a bailout for Huggies. Heck, even traditional Medicare and Medicaid ultimately pays for products and services provided by private entities, many of whom are large corporate entities like corporate hospitals, pharmaceutical companies, and medical device manufacturers, so ultimately those, too, are simply transfers to big, bad corporate entities.

Ultimately, the nature of the economy is such that every dollar, even if it comes from the government, is very, very likely to pass through for-profit businesses. Just where do we think people will spend their $1400 direct payments or additional unemployment benefits from Uncle Sam? Buying groceries at private grocery stores (and probably one owned by a large national chain), purchasing clothes at private clothing stores, putting gas in their cars from - gasp - corporate polluters, or even paying down debt held by privately banks and private credit card companies.

Yet, most people would agree that viewing direct payments and unemployment benefits through the lens of corporate profits would be absurd. Most people would agree that it's ridiculous to pretend school lunches - something Biden's stimulus makes free for all students through the summer - are really a way to prop up corporate agriculture and food services industries. Calling premium assistance for families and individuals to buy health insurance "funneling" taxpayer money to health insurance companies is equally ludicrous.

Even if one insisted on this absurd view, though, Wendell Potter's offered solution would not remedy the problem he defines. Even assuming that using the reconciliation process to make a policy change to allow those who aren't otherwise eligible to buy into Medicare would fit Senate rules and have enough votes to pass - assumptions which are absolutely from a fantasy world - allowing people to buy into, in Potter's words, the "existing Medicare program" would not stop taxpayer dollars from padding the coffers of private insurance companies.

This is because the "existing Medicare program" is not a single payer program. Medicare enrollees have a choice between traditional, government-payer Medicare and Medicare Advantage, which are Medicare plans offered by... drumroll please... private insurance companies. Medicare Advantage, or private insurance Medicare, has exploded since Potter's days as a health insurance executive. The rapidly growing percentage of Medicare beneficiaries who choose private plans stood at 40% in 2020.

Allowing new beneficiaries into the existing Medicare program would mean allowing those new beneficiaries to choose a private plan within Medicare as well, and as much as half may well choose to do so, which would also move money into the coffers of those private insurance companies.

It's okay to call out corporate excesses. It's good, in fact. It's essential to condemn lopsided wealth and income inequality. But let's not focus so much on the anti-corporate sentiment that hurting corporations - not helping people - becomes the measure of acceptable public policy.

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