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YouTube video of a GE commercial (there’s both a dancing elephant and a parrot in it–as well as other supporting characters in this unusual “Singin’ in the Rain” cast).

The “elephant” is not a reference to the GOP, but the “parrot” is a reference to health care reform… (Stay with me here…)

The Washington Post’s Kevin Huffman writes about both animals today, in the context of yesterday’s health reform summit (my emphasis added):

Thursday’s health-care summit was the latest episode in an epic battle between the elephant and its rider.

The elephant, in a metaphor originally devised by psychologist Jonathan Haidt, stands for our emotional side. It enables our capacity for love and loyalty and is behind our drive to protect our families. The rider stands for our rational side. It’s what makes long-term plans, sets the alarm clock and tells us to walk away from that pint of Ben & Jerry’s.

For the better part of the past year, Democrats have appealed to logic with health-care proposal after complicated health-care proposal, while Republicans have appealed to tea party emotion. It’s been comprehensive reform vs. the audacity of nope, and, if you believe the polls, nope is winning.

How is this possible? Well, in the fascinating new book “Switch: How to Change Things When Change Is Hard,” authors Chip and Dan Heath draw from social science research to argue that we embrace change only by bringing these oft-conflicted systems into alignment. They argue, “When change efforts fail, it’s usually the elephant’s fault since the kind of change we want typically involves short-term sacrifices for long-term payoffs.” At the same time, the rider without the elephant is prone to paralysis by over-analysis. Ultimately, the authors write, “a reluctant elephant and a wheel-spinning rider can both ensure that nothing changes.”

To me, this elephant-and-rider story is not just reminiscent of the health care debate; it’s the storyline of anything the government tries to do for the sake of “fiscal responsibility.”  It’s a hard problem to solve and the “elephant” in all of us isn’t just unconvinced, but completely disengaged…disenchanted…uninspired… BORED.

At yesterday’s health care summit, the President was indeed in control and acting like “commander in chief”–but more than that he was acting like “professor in chief” (as the Post’s Dana Milbank emphasizes in his front-page story and as I “tweeted” saying “Professor Obama is on a roll…”).  But who was listening, and who changed their minds?  Out of everything the President explained, got right, and straightened out (like the wise and commanding professor), the line that probably made (or should have made) the most impact with not just the politicians but more importantly the American public (if they were watching at that point) was this one highlighted by E.J. Dionne:

[G]ood for Obama for asking Sen. John Barrasso (R-Wyo.) if he would really rather have catastrophic care than comprehensive health coverage…But Obama then made the central point of the whole day. Speaking of the uninsured, he said: “We can debate whether we can afford to help them. We can’t say they don’t need help.”

Back to Kevin Huffman’s column, he also thinks appealing to the compassion in the politicians and Americans more generally would have been better than lecturing to them:

My unsolicited advice: a little less rider, a little more elephant. When Kathleen Sebelius talks up “pooled purchasing options,” people’s eyes glaze over. The logical arguments are good, but my elephant could not care less. Instead, try tapping into a deeper sentiment: This is America. We are the kind of country that doesn’t let a man go bankrupt because his wife or kids get sick. We believe everyone deserves a doctor. That’s who we are.

So what’s the “parrot” got to do with anything?  Again from Kevin Huffman:

In “Switch,” the authors tell a story about the St. Lucia parrot — a magnificent, colorful creature that lives only on that Caribbean island. Biologists were writing the species’ eulogy when conservation activist Paul Butler found himself charged with figuring out how to save the parrot. Butler had ideas: create a bird sanctuary, license eco-tourism and muscle up the punishments for harming the parrot. But he also had a problem. Most people on St. Lucia didn’t know about the parrot, let alone care, and some people even ate the poor bird. What to do?

Instead of making an analytical case, Butler went for the emotional. He appealed to St. Lucians’ national character. The message: We are the kind of people who take care of our own. This bird is ours alone, and we must protect it. He built popular support for new laws, and today, there are seven times as many parrots happily squawking on the island.

If the appeal to “emotional side” in all of us had been emphasized at yesterday’s summit, not only would the politicians have been more likely to see the “common ground” between them in terms of the goal or the “prize,” but they also would have been more inclined to work together to find agreement about the really tough choices about how to afford to claim the prize–how to achieve what everyone actually wants to do about health care, and deficit reduction, and all the other difficult policy issues that get stuck because people care only enough to want the goodies but not enough to be willing to pay for them.

It’s like I said in reaction to the President’s fiscal commission:

[T]he first thing the President’s fiscal commission needs to do is to start getting out there and talking with real Americans, educating them about why we even need to worry about the budget deficit, and asking them about the (hard) choices they’re willing to make (or not).

…because I have a feeling that what Paul Tsongas said was right (that we are better than what our leaders ask us to be), and we as Americans may be more willing to save the “parrot” of health care reform (or fiscal sustainability more generally) than our politicians realize.  They just have to talk with us more about the parrot and all there is to love about it, rather than all there is to think about it.  They have to let our elephant in us save the parrot.

It was the focus of the President’s weekly radio address (video and transcript here), but Jon Stewart’s (Daily Show) discussion of the upcoming health summit is hilarious and more enlightening at the same time.

(Photo from HuffingtonPost)

So, I’ve been pretty much paralyzed with this snowstorm (”Snowmageddon” as they’ve dubbed it) here in DC.  We have a couple feet of snow on the ground!  It’s made it difficult for me to keep up any of my normal routine either as economist or mom, in fact, so I haven’t blogged since before the first flakes fell.  But with everything including my work place, my kids’ schools and the federal government closed today, no Economic Report of the President released yet (I think it was supposed to come out this week, maybe even today), and not much to do other than wait for the snow to thaw (but you know, we have another round of snow coming tomorrow?!), I thought I’d attempt this little post relating this weekend’s storm to the fiscal policy issues I manage to obsess about even in the middle of something as distracting as all this snow.

On Saturday I witnessed this amazing mass snowball fight in Dupont Circle (pictured above)–here are Washington Post and Huffington Post stories and videos on it.  It sort of reminded me of how well bipartisanship is going these days on Capitol Hill, especially when it comes to coming together on fiscal responsibility…

We have the House Republican Leader, John Boehner, arguing that the President’s notion of a bipartisan fiscal commission would actually be a “partisan” commission, mainly because it would allow revenue increases to be put on the table (emphasis added):

The commission proposed by President Obama would reportedly be barred from proposing cuts to any discretionary spending, which accounts for more than one-third of all federal spending.  With discretionary spending off the table, tax increases would represent a very large portion of the policy options for decreasing deficits.  By seeking to take the ‘comprehensive’ route on every issue except spending, the Obama Administration only reveals its unwillingness to end Washington Democrats’ spending binge.

Of course, unlike mandatory spending, discretionary spending is subject to annual review through the appropriations process and can be constrained through the use of spending caps.  If the Administration really were unwilling to tackle the growth in government spending, they would have taken the big mandatory spending programs (Medicare, Medicaid and Social Security) off the table, but they didn’t–even with some pressure from the more liberal parts of their party to do just that.

House Majority Leader Steny Hoyer responded to the Boehner statement with this (emphasis added):

I’m disappointed in Minority Leader Boehner’s response to a sincere attempt to establish a bipartisan mechanism to address the fiscal challenges facing our nation.  The Obama Administration has made fiscal responsibility a focus over both the short- and long-term. Their budget proposal included several immediate steps, such as the freeze on non-defense discretionary spending and a Financial Crisis Responsibility Fee to ensure taxpayers are repaid.  Additionally, the President will sign statutory ‘pay-as-you-go’ legislation into law soon, reinstating a proven tool for bringing discipline to the budget process.

Over the long-term, a bipartisan fiscal commission is key to setting a path toward sustained fiscal discipline.  The Administration has repeatedly indicated its openness to constructive suggestions on how a commission should be structured, as evidenced by Secretary Geithner’s outreach to Minority Leader Boehner.   I regret that Leader Boehner rejected the Administration’s overture asking for input…

I agree that all options for restoring fiscal balance should be on the table for the commission to consider.  However, budget experts from across the political spectrum agree that finding a solution to our long term fiscal challenges requires focusing on tough choices with regard to entitlement spending and revenues. Regardless of how discretionary spending is handled, the proposed freeze for the next fiscal year is a strong action.

Many Republicans say a tax cut would spur growth and revenue. Mr. Obama suggested it would cost revenue and drive up the deficit. “I’m going to want to take a look at your math, and see how that works,” he said.

TAPPER: Do you think the fact that you guys are pushing the bipartisan commission is indicative of the fact that our political system is not capable of taking on the serious challenges our nation faces?  You and I know that the money, as Willie Sutton says, said, that — why do you rob banks? Because that’s where the money is. The money is in entitlement programs, Medicare, Medicaid, Social Security, things that you do not touch in this budget. The fact that you need a bipartisan commission to recommend cuts or tax increases, doesn’t that indicate that our political system is incapable of making these tough decisions?

GEITHNER: Jake, I am very confident in our ability as a country to bring people together and make sure we are solving these challenges and these problems. We’ve done it in the past. It is completely within our capacity to do as a country. But of course it requires you bringing people together across the aisle to step back from politics, to try to bring practical solutions to things that are very important to our future as a country. And the president is committed to do that. And we’re going to give the Republican Party the chance to share in the responsibility and the burden and the privilege of trying to fix the things that were broken in this country.

TAPPER: Republicans are afraid this is just a back door for tax increases. Are you willing to say that tax increases are off the table for this commission, let’s sit down and talk about the long-term structural problems with entitlement spending?

GEITHNER: The president’s view — and this is a view shared by many Republicans, and it builds on what we’ve seen with effective commissions in the past, like the Greenspan commission that President Reagan established to help restore the financial footing of Social Security — is that, for this to work, you’ve got to bring people together to step back from politics, day-to-day politics, and to bring fresh ideas to solve these kind of problems. That’s the only way to do it, we think, and we’re committed to doing that. We’ve got to do it on a bipartisan basis, and we’re deeply serious about doing this.

That’s why right now I feel a lot like Jonathan Chait does in his New Republic column from a week ago entitled “The Impossibility of Fiscal Responsibility.” Jonathan argues that fiscal responsibility is impossible because the Republicans aren’t cooperating or even “engaging” (not even in a chaotic snowball fighting kind of way), and that:

[I]t’s very hard for one party to reduce the deficit by itself. I wouldn’t say that the entire Democratic Party is committed to serious deficit reduction. But major elements are, and nearly the whole party is committed to at least not making the problem worse. But a unilateral commitment to fiscal responsibility is a huge political handicap…

The more Democrats do to reduce the deficit, the easier they make it politically for Republicans to retake power, and the easier they make it fiscally for Republicans to wreck the budget when they do. So, why try?

So, because right now there’s no evidence that current Republicans in Congress will budge an inch on the issue of taxes, and at the same time little evidence that the Administration yet has the courage to take the lead with their own party on taxes (and saying very plainly that they must come up, eventually), today I look at all the snow around me feeling “stuck” and can’t help thinking that “bipartisan fiscal responsibility” has about a snowball’s chance in hell.

Taking a little break with my oldest kid, Allie, this weekend–a combo belated 18th birthday and early graduation present. She’s been through a really busy and stressful few months with all of her college applications and finishing the last grading period that will really matter–with the self-imposed pressure to keep up perfection. Me?  I’m just “free-riding” by being her mom, and just getting started with the busiest season in my work–budget season… So what the heck, maybe this will put me in a good, laid-back frame of mind so I don’t just totally give up on hopes for fiscal responsibility in Washington. I come to you from Jamaica today, where “mon” means (from the “speak Jamaican glossary”):

Perhaps the single most important Jamaican word, “Mon” can represent every person in Jamaica—man, woman, and child. Yes mon! (Yes man, woman, or child!)

…So yes, “moN” can refer to a “moM”! 

I’ll still be here for half a day on Monday when the Administration’s budget comes out–and believe it or not, will be perusing its pages from my laptop on the beach before we pack up to head home.  So even if you don’t hear from me right away on Monday, you can expect my take on the budget by Tuesday. Yeh, mon — mos def!

…or else most of us would be pretty unhappy right now.  In Sunday’s Washington Post, Carol Graham of the Brookings Institution explains how even economists are starting to realize that not everything can be valued in monetary terms:

How much happiness does money really buy? How do you weigh the relative loss in happiness resulting from a pink slip, a divorce or a diagnosis of illness? Such questions have gone from the fringes to the center of the dismal science, with economics journals now boasting thousands of articles from “Does Happiness Pay?” to “Do Cigarette Taxes Make Smokers Happier?”…

Wherever I look, some simple patterns hold: A stable marriage, good health and enough (but not too much) income are good for happiness. Unemployment, divorce and economic instability are terrible for it. On average, happier people are also healthier, with the causal arrows probably pointing in both directions. Finally, age and happiness have a consistent U-shaped relationship, with the turning point in the mid- to late-40s, when happiness begins to increase, as long as health and domestic partnerships stay sound.

All of this seems rather logical, suggesting that if a government wants to get into the business of promoting happiness, it can pursue some straightforward policy goals, such as emphasizing health, jobs and economic stability as much as economic growth.

But here’s the complicated part. While there are stable patterns in what leads to happiness, there is also a remarkable human capacity to adapt to both prosperity and adversity…

The bottom line is that people can adapt to tremendous adversity and retain their cheerfulness, while they can also have virtually everything — including good health — and be miserable…

And Carol explains that sometimes true happiness over the longer term isn’t easily achieved by focusing on instant gratification:

Broader definitions of happiness — for example, as the opportunity to lead a fulfilling life — suggest deeper objectives that may cause unhappiness, at least in the short term. Overthrowing the French monarch, or defeating the Taliban, are not exercises that bring immediate happiness to mind. Closer to home, efforts to reform our health-care system or address the ballooning budget deficit are unlikely to produce happiness anytime soon. Yet we know that these problems must be addressed to preserve the welfare of our citizens — and our children — over the long term.

The front page of the same Sunday Washington Post featured a survey of Detroit-area residents, with the surprising finding that despite the nation’s highest unemployment rate, nearly two-thirds of them remain “optimistic” about the future of the Detroit area.  I’ve written and speculated about Detroit’s optimism before, it being my home town and my knowing many positive-thinking, hard-working people who are still making a living in the auto industry there.

Still in the very same issue of the Post, Jim Wallis (who also hails from Detroit) has a theory about why that is–that optimism can prevail in a community like Detroit, facing such economic hardship:

In my home town of Detroit, which has been hit especially hard by the recession, with unemployment levels over 30 percent, the Capuchin Fathers are giving away hundreds of thousands of plants, helping to seed a renaissance of hundreds of urban gardens and family farming plots, and providing healthy food, work for the unemployed and an activity for the community to gather around. It may be in the places like these — where all that is left is hope — that new life first shoots up.

So here’s to a Happy New Year and a Happy New Decade even.  No matter the tough times we’re in right now, there are always valuable lessons learned and silver linings to be found, even when we’re not looking for them.  And sometimes the really awful times bring about just the purging and pruning we need to thrive and blossom even better afterwards.

Today’s Alice Williams’ last day working at the President’s Council of Economic Advisers. Alice is retiring after 51 years of federal government service!  David Wessel posted a nice Wall Street Journal blog about Alice’s retirement and the party thrown for her (which was pretty amazing to attend with all those CEA chairs and staff who had spanned all those decades of Alice’s tenure). I had the privilege to work with Alice for just one year at the end of the Clinton Administration, but the good fortune to know her and “soak in” her wonderful personality ever since.  She is truly an inspiration and honestly a better role model for me than any economist has been–well, with the possible exception of another “Alice” (Rivlin).  What I’ve always loved about Alice Williams was how she both works hard and plays (dances!) hard and does both so capably and with such joy.  (Check out this Washingtonian story on ballroom dancing that features Alice…turns out it is easier to “google” Alice via references to dancing vs. references to the CEA.) My fondest memories of Alice will be seeing her donning her sneakers, walking laps around the grand hallways and staircases of the Old Executive Office Building, every lunch hour of every business day, as a way of getting her exercise in while staying close at hand for the “fire fighting.”  Yes, the woman has great legs–besides a great head!  Congratulations, Alice!  (I hope our get-togethers from now on will center around a dance floor whether I come see you dance or you help show me how!)

Happy Holidays to all my readers!  I will be posting less frequently over the next week–but have no fear, I will be back with a vengeance around New Year’s with some EconomistMom “resolutions.”  Until then, just want to make sure you all saw the Concord Coalition’s new issue brief on the “end game” on health care reform.  As summarized on Concord’s Tabulation blog:

With the House having passed its version of health care reform (H.R. 3962) and the Senate on the verge of passing its version (H.R. 3590), the outline of a final bill is beginning to take shape. In our new Issue Brief, we look ahead at the fiscal considerations that will likely be the subject of conference committee discussions and “end game” negotiations. These include the cost of expanding coverage, the methods used to prevent that cost from adding to the deficit, and the prospects for systemic reforms to reduce cost growth over time.This issue brief gives The Concord Coalition’s perspective on how the bills measure up, what the risks are and how these risks could be lessened. We conclude that:

•    Both bills establish an important benchmark by achieving deficit reduction according to official cost estimates by the Congressional Budget Office (CBO). However, the fiscal outlook remains on an unsustainable track even with the modest deficit reduction achieved under either plan.

•    There are clear risks that some of the methods used to achieve deficit reduction in the official scores may not hold up over the long-term.

•    The revenue package in the Senate bill holds more promise to reduce the deficit than the House version because its largest component — the high-cost insurance excise tax — will better keep up with the growth rate of health care spending, and will also work to lower health care costs.

•    Both bills contain many promising reform strategies to achieve long-term cost control. However, these strategies remain unproven and cannot be counted on to produce timely, reliable savings without a strong cost control mechanism such as the Senate’s proposed Independent Payment Advisory Board (IPAB).

The “Fiscal Risks” mentioned in the discussion include:

• Doing nothing
• Spending offsets that are not maintained over time
• “Curve benders” that don’t pan out or are not adopted more broadly
• Failure to include an effective cost control mechanism
• Lagging revenue increases
• General revenue bailout of the CLASS provision
• Inadequate premium subsidies, weak penalties, and a poorly designed exchange

In our conclusion we discuss the possible changes that could be added to the legislation to lessen these risks and further promote fiscal responsibility.

To read the full issue brief, click here: http://www.concordcoalition.org/issue-briefs/2009/1223/health-care-reform-end-game-fiscal-considerations

…otherwise, Senator Reid’s “manager’s amendment” to the health care reform bill would be a “wash” for them. A snow-day CQ story by Richard Rubin exposed the sillier side of how a health care reform bill is made (emphasis added):

The amendment also would replace a proposed 5 percent excise tax on cosmetic surgery with a 10 percent excise tax on indoor tanning salons. The new tax raises $2.7 billion, instead of the $5.8 billion raised by the cosmetic-surgery tax, or “Bo-tax,” as it was known.

“Basically, the docs, to get their support, didn’t want Bo-tax, but they’re fine with tanning,” said Baucus, who specifically mentioned the support of the American Medical Association. “Tanning’s a bad practice. It causes cancer. Tanning beds should be taxed.”…

The amendment also slightly changes the proposed excise tax on high-cost health insurance plans. Longshoremen would be specifically added to the list of high-risk professions that get a higher threshold before the 40 percent tax takes effect.

This Dow-Jones story by Martin Vaughan offers an “interesting” (ok, silly and ridiculous) justification for removing the cosmetic surgery tax and describes the “interesting” (ok, silly and ridiculous) new debate it’s spawned between the plastic surgery lobby and the indoor tanning lobby (emphasis added):

Senate leaders dropped from the bill a 5% tax on all elective cosmetic surgeries that had been in an earlier version. Allergan Inc. (AGN), along with Medicis Pharmaceutical Corp. (MRX), and other firms lobbied against that tax, arguing that it was unfair to working women…

The indoor tanning industry has been fighting its own public relations battle as the U.S. Food and Drug Administration in recent weeks has sharpened its warnings about the risks of ultraviolet rays from indoor tanning beds. The tanning excise tax would raise $2.7 billion over 10 years for federal coffers.

John Overstreet, executive director of the Indoor Tanning Association, lashed out at plastic surgeons in a statement.

“It is not surprising that one primarily cosmetic business is trying to throw another under the bus by transferring a tax from rich doctors and their wealthy customers to struggling small businesses,” Overstreet said. “The irony is that ultraviolet light at least has proven health benefits where botox treatments have none.”

OK, let’s just call it the quest for the perfect “you look maaa-velous” (and obviously have too much discretionary income but not enough lobbying influence) tax.

And I do not normally find myself agreeing with the Wall Street Journal editorial page (I’m always calling for taxes to be increased after all), but when even they find themselves complaining about tax preferences that are based on political lobbying power rather than economic merit, I have to say they’re right:

Start with the special tax carve-outs included in the “manager’s amendment” that Harry Reid dropped Saturday morning. White House budget director Peter Orszag has claimed that the bill’s 40% excise tax on high-cost insurance plans is key to reducing health costs. Yet the Senate Majority Leader’s new version specifically exempts “individuals whose primary work is longshore work.” That would be the longshoremen’s union, which has negotiated very costly insurance benefits. The well-connected dock workers join other union interests such as miners, electrical linemen, EMTs, construction workers, some farmers, fishermen, foresters, early retirees and others who are absolved from this tax.

In other words, controlling insurance costs is enormously important, unless your very costly insurance is provided by an important Democratic constituency.

The Reid bill also gives a pass on the excise tax to the 17 states with the highest health costs. This provision applied to only 10 states in a prior version, but other Senators made a fuss. So controlling health costs is enormously important, except in the places where health costs need the most control.

If only the WSJ editorial page (and those who normally agree with them) would see how their logic might apply to the large tax preferences (really, “tax entitlements”) granted to the oil and gas industry/lobby, or to the farm industry/lobby, or to seniors (who don’t even need lobbyists but still have a pretty great one in the AARP).

I’ll have more to say on the not-so-silly aspects of tax policy in the House and Senate health reform bills later this week.

Getting rid of our debt? Why, all it takes is some alchemy, animal cruelty, and a really creative stimulus plan for Detroit…talk about bang for the buck!

I’m prepared to be buried in snow for a couple days (here in the DC area), so I expect I’ll have more writing time than usual this weekend. And perhaps some of my readers will have more reading time than usual, too… between online shopping, I mean.

Continuing on what gives me (and other fiscal hawkish types) “loosey-goosey” anxiety about health reform, OMB director Peter Orszag had explained in the Monday story by Lori Montgomery that (emphasis added):

“The legislation is reflecting all the ideas that have been put forward in health policy circles for years and creating a feedback-and-continuous-improvement loop that will allow us to learn as we go,” Orszag said. “When someone says it’s not guaranteed to work, my response is: Doing nothing is guaranteed to fail.”

The good ideas are what Peter often refers to as “game changers”–health policy changes that actually have promise to “bend the cost curve” in the right direction (downward).  But by Peter and the Administration’s own admission, these “game changers” largely take the form of pilot and demonstration projections in current bills, because we still have to learn about how to play the game intelligently.  So we’re really talking about studying and practicing these game-changing “plays”–and not yet actually playing the game.  That’s why Peter acknowledges that it’s going to take “decades” to see the fruits of the “game changing” policies the Administration seeks in the health reform package–to see those “game changers” turn into true “curve benders.”

One feature of the legislation that Peter and the Administration see as critical to curve-bending success is the establishment of a Medicare commission that would be an essential part of the “feedback-and-continuous-improvement loop” that Peter talks about.  As Peter explained on the OMB blog this summer (emphasis added):

There are a number of steps that can be taken to bend the curve – health IT, investing in research into what works and what doesn’t, and changing incentives so that doctors and hospitals give you better care not just more care. But one of the most potent reforms is a change in the process of health care policymaking: empowering an independent, non-partisan body of doctors and other health experts to make recommendation about Medicare payment rates and other reforms.

But as Concord’s policy director, Josh Gordon, explained this morning on Concord’s “Tabulation” blog:

The Concord Coalition firmly believes that having an independent Medicare commission is one of the most important elements being considered in current health care reform legislation. Without the commission — which would be empowered to continuously evaluate Medicare costs and propose changes to the delivery of care that might be able to help reduce system-wide health care costs — it is doubtful that current legislation will succeed in reducing long-term health care inflation.

Unfortunately, the bill currently being debated in the Senate has effectively neutered the commission’s powers (and the House didn’t even have a commission in their bill). As pointed out by David Leonhardt in the New York Times, the Senate directs that the commission leave doctors and hospitals untouched by its recommendations for the first four years of its existence (2015-2018). Then, in an even more insidious direction, the permanent commission will likely be prohibited from submitting a proposal beyond 2019. These restrictions are layered on top of the initial restrictions Congress placed on the White House’s commission proposal (benefits can’t be “restricted,” cost sharing can’t be increased, eligibility can’t be modified, and health care can’t be “rationed”)…

[The current Senate bill] basically says…that no proposal can be submitted in any year after 2019 if the five-year average of national health care expenditures grows more rapidly than five-year average Medicare expenditures. This makes it unlikely the commission will get many opportunities to submit a proposal. As our Series on Health Care and Medicare points out, expenditures in Medicare tend to rise at slightly lower rates than overall health care expenditures (from 1970-2007 annual per- capita Medicare inflation averaged 9.2% while the private health care average was 10.4%).

An irony of this provision is that almost the entire cost control structure of current health care legislation is predicated on the idea that reforms in Medicare will have to lead the way towards a broader reform of the private health care system because the government can easily experiment and alter Medicare — as opposed to trying to dictate systemic transformation in the private sector. Yet, with this restriction, the government’s ability to change Medicare will instead be stuck waiting for the private sector to magically restrain costs first.

This is Concord’s “loosey-goosey” worry:  not that a Medicare commission along the Administration’s specification won’t work–but that a “toothless” Medicare commission won’t work.  And why do we worry about the “toothlessness” of its congressional specification?  Because Congress is “pulling teeth” on the health care bill as we speak. I mean when “maverick” fiscal conservative John McCain has this to offer and argue:

The second amendment, authored by Sen. John McCain (R-Ariz.), would strip out the bill’s primary revenue source, nearly $500 billion in Medicare cost savings. Although AARP and other seniors groups have said otherwise, Republicans are attacking the cuts as a threat that could eventually shorten lives.

“They’ve paid all their working lives into the Medicare trust fund, and now they’re in danger of having $483 billion cut out of it, which would eventually lead to rationing of health care for seniors in order to fund a new, government-run health-care system in America,” McCain told reporters.

…then I think there’s not much hope of Congress producing a bill with a continuous-feedback loop that will truly “change the game” and truly “bend the curve.”  Unless the President and the few courageous members of Congress who are around insist on getting a Medicare commission with real “teeth” into the bill, the only continuous-feedback loop will be a toothless (and blabbering) one…like “Precious.”