Is "deficit neutrality" too easy a test?
- The United States faces a large long-term fiscal gap between spending and tax revenue.
- That gap is driven in large measure by increasing healthcare costs.
- Healthcare reform should "bend the curve" and reduce future healthcare costs.
In light of these facts, shouldn't the healthcare reform bill be more than deficit neutral? Shouldn't it reduce the long-term structural deficit? As Donald Marron points out, current Congressional efforts do not even meet the standard of deficit neutrality. But even if they were deficit neutral, that would hardly be a success.
We were once told that healthcare reform would help fix our long-term fiscal problems. Now the standard is that healthcare reform won't make these problems worse.
By the way, for new readers of this blog, I wrote about my preferred solutions to the long-term fiscal gap here.
Update: A reader suggests an analogy: An obese friend is told that he should eat less and exercise more. Instead, he adds an extra serving of cake after dinner. But don't worry: His cake-eating plan is calorie-neutral, as he promises to exercise more as well.