Matthew Ladner

Mr. President, public universities are no example of effective subsides

Posted on September 15, 2009 | Author: Matthew Ladner
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President Obama made the following statement during his recent health care address:

It would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students without in any way inhibiting a vibrant system of private colleges and universities.

I almost fell out of my chair. Universities and health care share a common problem--massive subsidies. Both are suffering from runaway costs that have increased far beyond the rate of inflation. If public universities are keeping private universities in check, someone forgot to tell the private universities. Their costs have been rising even faster than health care for decades.

Congress has been chasing its tail on "college affordability"--providing increasing subsidies, watching costs go up, and repeating the process. The same is true of health care. Through Medicare, Medicaid, and the tax treatment of employee benefits, Congress has thrown more and more tax dollars at health care only to watch cost inflation spiral out of control.

As far as a "public option" to help keep health care costs down, the President might have a good deal more credibility if Medicare and Medicaid costs hadn't spiraled out of control. Call me crazy, but I'd like to see the slightest bit of evidence that costs in these already unaffordable programs can be controlled before starting a new one.
 
Dr. Matthew Ladner is vice president for research at the Goldwater Institute.
 
Learn More:
 
Goldwater Institute: Removing the Middleman: What States Can Do to Make Health Care More Responsive to Patients
 
Goldwater Institute: Health Care Choice: Giving Arizonans More Health Insurance Options
 
Cato Institute: Handbook for Congress

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