The fact that health care reform is controversial turns the economist’s assumption about the rationality of individuals on its head. To be earnestly against the Democrats’ health care reform plan one would have to believe one or more of the following:

• “I hope they don’t close the Medicare ‘doughnut hole’.”

• “I want to be unable to change jobs or move to another city because, if I did, I’d lose my employer-provided health care coverage.”

• “I want to be denied coverage because of a preexisting condition.”

• “It’s okay if my insurance is rescinded when I become seriously ill.”

• “I want my insurance to have lifetime payment caps so that if I’m stricken with a serious illness I can choose bankruptcy or death.”

No human being in the world, who’s rational, holds any of these beliefs, of course. Which makes opposition to health care reform puzzling. In vain one waits to hear just one reasoned, informed rationale from a “grass-roots” protester, on radio or television, for their impassioned opposition to health care reform. At a recent speech by President Obama on health care, the crowd was mostly respectful. But one exception was a man so passionately opposed that he shouted repeatedly from the back of the venue. Interviewed on NPR¸ he said he opposed the bill (1) because it would provide federal funding for abortions (which it won’t) and (2) because it would increase the federal debt (which it won’t). (The reporter who interviewed him (Don Gonyea), needless to say, made no effort to correct him or the record.) And this is one of the more lucid explanations from a “grass-roots” activist for opposition to the bill. Usually they talk about “socialism” or a “government takeover of health care” or whatever.

The benefits of health care reform are immense, the costs negligible. The upside is obvious, the downside hard to see (or at least not articulable by anyone opposed to it). So why has health care reform been such a slog?

My analysis is this. Health care reform is somewhat complex (not extremely, but somewhat). Americans on average are of average intelligence. They’re busy, with little time or inclination to study matters of public policy. Their steady diet of junk information leaves them intellectually unprepared for issues of modest complexity, like health care reform. And within this informational void Republicans and right-wing commentators have free reign to lie and to lie and to lie. And they’ve taken full advantage. Here’s Dave Camp, Ranking Republican member of the House Ways and Means Committee:

“They [the American people] don’t want a trillion dollar bill. It’s going to take thousands of pages of legislation. It’ll raise taxes, increase the debt, and cause them to lose their health care… I think we ought to work on a bill that doesn’t cut Medicare, that doesn’t raise taxes, that doesn’t put more debt on the American people.”

There are two things going on here: spin—framing things in misleading ways—and overt lying. In the category of spin is the implication that the bill will raise your taxes. It would raise some peoples’ taxes—those of affluent Americans or workers with “Cadillac” insurance plans. But that’s a small portion of the population. And almost certainly it won’t raise “your” taxes.

Also in the spin category is the claim that the bill will “cut Medicare.” (Arguably this is closer to overt lying.) Yes, the bill seeks Medicare savings (1) by reducing overpayments to Medicare Advantage and (2) by establishing a Medicare commission—a panel of independent experts that would craft packages of delivery-system reforms to be voted up or down by Congress (with no amendments or filibusters, to free the reform process from special interest politics).

But the Medicare commission is essential if we are to deal with the long-term fiscal problems of the U.S. And the cuts in Medicare Advantage are fully justified. Medicare Advantage, as you may know, is a program whereby some Medicare funds, rather than being paid directly to health care providers, are funneled through private insurers. The idea was to get more bang for the buck, i.e., more medical care per dollar of spending, which would be possible because, as we all know, the private sector is much more efficient than the public sector in all things. The only problem is that it hasn’t worked. Through Medicare Advantage the government pays the private plans, on average, 14 percent more than the same services would cost under traditional Medicare. So taxpayers and other Medicare beneficiaries are in effect subsidizing the 10 million or so people on Medicare Advantage. And many of the latter receive supplemental benefits (like vision, dental, even gym membership) that traditional Medicare beneficiaries don’t get. So it’s unfair. Reducing these overpayments is good public policy.

In the overt lying category is the claim that the plan will cause people “to lose their health care.” In fact most people, covered through their employer, will see no change whatsoever in their health care. The bill will, however, extend health care coverage to 32 million people, according to the CBO. And math is hard, but I think 32 million is a positive number. 

Also in the overt lying category is the claim that the bill will “increase the debt.” How do Republicans get away with so baseless a claim? And why are so many Americans so gullible as to believe it? And why can’t the media set the record straight? Anyway, the CBO estimates that the legislation will reduce the deficit by $138 billion in the first ten years and $1.2 trillion over the first 20 years. Not trivial. It’s the most serious effort to get the American fiscal house in order since 1994.