Exceptional Productivity in Health Care and Elsewhere

EXCEPTIONAL PRODUCTIVITY

According to ITIF, Without exceptional productivity growth, strong across-the-board income growth is almost impossible. While I rarely agree with the Information Technology & Innovation Foundation (ITIF), a mostly conservative think tank, this is an exception. Their report concludes that economists and policymakers have given too little attention to productivity for too long, and they are calling for a national productivity strategy.

As a retired IBM technologist, futurist, and political progressive, I look for ways to make strategic investments in progress and economic prosperity for all. I’m frustrated by extreme wealth and greed, by the resulting political corruption, and by the policy stagnation of our divided congress. The future I envision and want is driven by public investments in infrastructure, research, and a skilled, healthy, and increasingly productive workforce. My ideal future includes social programs aimed at “lifting all boats,” benefiting our collective lifestyle, and with little to no harm to the wealthy or their private investment incentives.

AMERICAN EXCEPTIONALISM

We have a long history of congratulating ourselves for being the best, greatest, strongest, freest, most powerful, most prosperous, and most democratic nation on earth. But even as the dollar still rules economically, our world image has become tarnished by racism, extreme inequality, political corruption, a contested Presidential election, and losing wars in Afghanistan and Iraq and Vietnam before that. As I wrote in Does America Have Exceptional Healthcare, even our healthcare is now the most expensive but ranks near the bottom as we live sicker and die younger. So I agree with ITIF. America seems to need some polish, some self-reconning, and some reinvestment.

AMERICAN COMPLACENCY

How could a country so gifted, so special, so superior, and so blessed be so hated by so many on the outside and so criticized by so many on the inside? The answer is complex, but I think complacency is a primary cause, along with the blind belief in American Exceptionalism.

SOCIAL INVESTMENTS

Those on the political right may call it “socialism,” but America has long invested in programs with social or shared benefits. The examples are too many to list but include transportation infrastructure, basic research, public schools and colleges, parks & museums, electric utilities, water treatment facilities, fire and police departments, Social Security, and Medicare and Medicaid. Our nation’s greatest growth in prosperity and world power came after World War II when we made those strategic investments in ourselves.

DECLINING MIDDLE CLASS

Other nations have invested too, and in many ways, they have caught up and surpassed us. A single-income American family of four used to be able to afford a house, a car, a college education for the kids, and still have enough for retirement. Today, that requires two incomes or working multiple jobs, and that’s one reason we need new social programs like paid maternity leave and affordable childcare.

FUNDING REINVESTMENT

President Biden’s Build-Back-Better plan includes two rounds of strategic investments, but as popular as they are, conservative politicians have complained that the cost is too high. That’s because they see costs rather than investments, and they worry about where the money will come from rather than thinking about the money that will be generated. Here are just two funding ideas: tax wealth and reform healthcare.

TAX WEALTH

Biden brokered a global agreement on a minimum 15% corporate tax rate. That’s commendable and will lessen the incentive for companies to move offshore to avoid taxes if we raise them here. But wealthy individuals can still avoid paying income tax. They can finance their lavish lifestyles by borrowing on accumulated wealth. So, I support Elizabeth Warren’s wealth tax but think it should be higher (say 3% instead of 2%) and annual. Their wealth will continue to grow at a rate faster than most of us enjoy, so that 3% is a pittance and will have no effect on their personal investment incentives.

Here’s a personal example: As a retiree on social security, with a modest pension and relatively small IRA, I’ve been averaging over 7% growth per year for years. The rich employ professional money managers, tax accountants, and lawyers who can eke out far more than I’m able to do.

REFORM HEALTHCARE

Here at Modern Health Talk, I write about health policy and constantly call for reforms aimed at cutting overall costs in half to match what other rich nations spend. They insure everyone with universal healthcare systems providing superior outcomes and longevity. Since we in America currently spend over $4 trillion per year on healthcare (approaching 20% of GDP), we could SAVE $2 trillion every year with a single-payer system like Medicare-for-All. That’s $20 trillion over 10 years, which could fund Biden’s plan four times over.

Exceptional productivity growth is required.