Anyone who doubts the importance of controlling health care costs should look at the graphs in the report from the Council of Economic Advisors. Economists generally agree that a major reason that family income has been stagnant for decades in the face of higher worker productivity is that the extra dollars have gone into into health care. The Council estimates that health care reform will produce higher growth (as much as 4% increase in GDP by 2030) by freeing up resources for other investment, decreasing workforce disability, and lower government and employer insurance costs. This will lead to higher family income as well as lower federal deficits.
Wednesday addendum: David Leonhardt of the NY Times weighs in, noting that the "insurance lock" of the current system contributes to what he calls our
"innovation deficit," where 1.5 million
don't change jobs because they don't want to jeopardize their current insurance.
