Mayors Cheer Single Payer—Most of the national news media missed the story in the last week of June: the U.S. Conference of Mayors unanimously endorsed a bill that would provide universal health care under a single-payer system.
West Palm Beach Mayor Lois J. Frankel introduced a resolution to support HR 676, Rep. John Conyers’s (D-MI) bill that would expand Medicare to cover everyone in the country. The resolution contains now-familiar arguments for single-payer, universal health care: the administrative costs of private insurance are devouring some 30 percent of private health spending, while Medicare’s administrative costs remain below 5 percent; U.S. hospitals are spending 24.3 percent of budgets on billing and administration, while hospitals in Canada’s single-payer system spend only 12.9 percent; Harvard researchers say more than $300 billion in health care costs would be recovered by replacing private insurance companies with a government run single-payer system.
Physicians for a National Health Program has been a leader in the national effort to create a single-payer system. Dr. David Prensky, a retired dentist in Palm Beach, and Alison Landes, a health care advocate working with Floridians for Health Care, coordinated the campaign at the Miami conference. The resolution passed in committee, and then in the plenary session, with no opposition.
Progressives are generally divided into incrementalist and absolutist camps regarding a cure for the nation’s critically ill health care system. Incrementalists advocate the creation of a government-run, single-payer plan to compete with private insurers. Absolutists back the single-payer plan with immediate coverage for all Americans. The mayors gathered in Miami unequivocally came down on the side of the Conyers proposal, with no incremental steps between the current system and universal health care.
Off the Bus—In April, we suggested that Phil Gramm wouldn’t make it to the end of the ride on John McCain’s Straight Talk Express (see the Washington Spectator, April 15, 2008). In July, Gramm got off the bus, sparing McCain the task of throwing him under it. McCain admits that the economy isn’t his strong suit. So he’d turned to Gramm, who once chaired the Senate Banking Committee, to shape his economic policy, describing him as the smartest economist he knows. Gramm cut ties to the campaign after McCain denounced the former Texas senator’s claim that the current economic downturn is a figment of the public’s imagination and that America has become “a nation of whiners.”
However it is Gramm’s record that is most disturbing. In April, we addressed Gramm’s critical role in securities trading reform, which legalized the complicated debt-trading mechanisms that made the current subprime lending crisis possible. The meltdown at Fannie Mae and Freddie Mac remind us that Gramm was a multi-tasking deregulator in the Senate. He was one of three sponsors of the Gramm-Leach-Bliley Act, which did away with landmark legislation that for eighty years had regulated banking in the U.S.
Until Gramm-Leach-Bliley dismantled what remained of it, the Glass-Steagall Act of 1933 maintained a wall between investment banks and the commercial banks at which most Americans did business. When it passed in 1999, Gramm-Leach-Bliley eliminated that wall. The law Gramm co-sponsored in 1999 was the most important revision of banking law since the New Deal, allowing the creation of enormous transnational commercial banks and holding companies, such as Citibank and the Swiss bank UBS—the latter being Gramm’s current employer when he’s not providing pro bono advice to John McCain.
Gramm’s dereg legislation is a critical factor in the current international banking crisis, in which UBS has fared worse than any other European bank. By May, two weeks after we addressed Gramm’s penchant for deregulation, UBS had already written down $38 billion of its asset-based securities in response to the credit crisis that began last summer.
UBS isn’t alone. Globally, banks have written down more than $340 billion since the start of the crisis. The mega-losses for the mega-banks wouldn’t have been possible under the regulations Gramm-Leach-Bliley eliminated. Phil Gramm may be off the bus, but he is still responsible for John McCain’s economic policy proposals, which originated with promises to maintain the Bush tax cuts and balance the budget—inherently contradictory proposals that are pure Gramm-onomics.