The Long View

A New Birth of Freedom

The enactment of the new federal health-insurance system this week marks the beginning of the reversal of the Great Risk Shift that has characterized American society since the late 1970s. There is now reason to hope that American society can return to something like its historical condition, in which it was possible to change jobs and geographical location without taking your life into your hands. Wages may again be able to rise, since all new money that becomes available for personnel costs will not automatically be eaten by insurance-premium increases. More generally, the subtle loss of morale generated by a system that, for the first time in American history, made a physical necessity problematical will begin to abate, with a consequent rise in personal initiative and national cohesion.

And that's just the half of it.

The attempt by partisan Democratic forces to link the passage of the healthcare bill with another effort to loosen immigration control was particularly ill-conceived. The open-borders regime was also an aspect of the Risk Shift. During the Shift, public policy set its face against a labor regime designed to keep wages stable or rising from increases in productivity. The eclipse of the labor unions was part of this policy. Another was the toleration of a shift toward an ever-replenishing low-skill labor force, along with the encouragement of the sort of economic activity that such a force suited. A key part of this new economy was its legal informality: the idea was to drive wages in some economic sectors as close as possible to subsistence, which required freeing the system of the regulatory structures not just of the New Deal but of the Progressive era. A universal health system was incompatible with this regime, since part of the new labor pool was by design legally opaque, and the rest had wages too low to easily accommodate medical services beyond emergency treatment for physical injuries. Neither the opacity nor the low wages can be maintained under the new system.

The anti-natalist program called the abortion-rights movement chimed with the economics and culture of the Risk Shift. As Justice Ginsberg recently noted, this program was largely about population control; certainly its institutional sponsors promoted it for that reason. The lowering of the fertility rate that it created, even below replacement level, more or less required a relaxed immigration environment. However, these points could not be made too explicitly if the program were to continue. Therefore its proponents accepted the Shift principle that there is no such thing as the public good, and that only rights claims were private ones. (At first this embrace was tactical, but it finally became sincere: readers will be reminded of the Ambrose Bierce anecdote about the oil-drill salesman who increased sales by starting a rumor that oil had been discovered in Hell and then went to Hell himself when he heard the rumor from others.) This principle dovetailed the fact that the health-insurance companies were nominally private. Public provision on abortion services might be objected to on libertarian or religious grounds, but these were not seen to apply when the payor was private an entity. The rule became: where public authority advances, abortion must retreat. Now, however, all health-insurance providers are essentially publically regulated utilities. The legislative history of the new reform suggests that the public-displacement rule is still in force, and will only strengthen with the passage of time.

Readers may object that the points in the two preceding paragraphs are, on the whole, contrary to the stated policies of the Obama Administration and the ideological predilections of the majority of its supporters. To that one need only respond that history is cunning, and that the most important consequences are usually the unexpected ones. This debate has launched America on a trajectory that neither side has anticipated or would endorse if it did, but a trajectory that does not necessarily arrive at a bad destination. Like the New Deal, and unlike the Great Society, this reform is an essentially conservative measure, one of many to come. During the Risk Shift, we forgot what genuine conservatism looked like.

As for the opposition to the reform, it recapitulates one of the insistences of American culture: incredulity of the fact that tyranny can be exercised by private entities. This was true in the Abolitionist era, when the defenders of slavery sincerely argued that theirs was the side of liberty because they were defending local autonomy and private property. Similarly during the days of the growth of industrial unions, when well-meaning people might insist that company towns could not be little tyrannies because the company was not the state. This is not to suggest that the state is incapable of tyranny, or even that the public good must always trump the private good, or even personal convenience. It does suggest that the use of public authority to promote genuine personal liberty is entirely appropriate.

Here are two items for people who want to pursue these questions further:

A review of Grand New Party.

A review of The Death of Conservatism.

Again, I would caution readers against the assumption that the controversy about the health-insurance system will continue to be a major item of public discussion, or the leading issue in the 2010 elections. Other issues will supervene.