MIT economist Jonathan Gruber has, for a long time, been the go-to
guy for people who want to defend the Senate bill. (Today Sen. John
Kerry has an article
on the Huffington Post defending the excise tax in which he quotes
only one economist, Jonathan Gruber.) Gruber does not just support the
Senate bill, he defends the bill by making completely ridiculous,
over-the-top claims about the bill, which border dangerously close to
outright lies. For months, I have wondered why Gruber was committing
what I considered economic malpractice with his untruthful statements. I
previously thought that he was just a guy who enjoyed the stoplight and
was prone to exaggeration. Having recently found out that he received
close to $400,000 from single source contracts with the Department
of Health and Human Services to study the effect of the "President's
health care proposal," I'm no longer as curious about his behavior.
"I'm sort of a known skeptic on this
stuff," Gruber told me. "My summary is it's really hard to figure out
how to bend the cost curve, but I can't think of a thing to try that
they didn't try. They really make the best effort anyone has ever made.
Everything is in here....I can't think of anything I'd do that they are
not doing in the bill. You couldn't have done better than they are
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Like many over-the-top claims Gruber has made in interviews, this one
is simply not true. There is single payer, drug re-importation, direct
Medicare pharmaceutical price negotiation, a robust public option, a
centralized reimbursement negotiator, single standardized insurance
packages, turning all insurance companies into non-profits, eliminating
direct-to-consumer drug advertising, creating a faster pathways for
biosimilars-it is long list of options. To put it simply, there are a
lot of common proposals that could have saved the nation hundreds of
billions on our health care costs that are not in the Senate bill.
The Senate bill does not contain every cost control idea out there,
it does not even contain most of the cost control ideas that were part
of Obama's health care proposal during the campaign. Any health
economist should know that. In fact, when the administration cut its
secret deal with PhRMA that promised reform would not cost the drug
industry more than $80 billion, Obama jettisoned a proven cost control
idea that he advocated during his presidential campaign: drug
In the many articles which quote Jonathan Gruber, I have never seen
it disclosed that he was a paid
consultant to the Obama Administration. For months I have been
angry with Gruber because I thought he was simply an exaggerator whose
dangerous love of the spotlight was hurting the efforts of progressives
to make sure the Senate bill adopted more progressive cost control
solutions. I could not understand how any health care expert could issue
such blatant falsehoods about health care reform. Now it is clear
something much more sinister was at play.