In a speech today, President Obama called income inequality combined with reduced economic mobility the defining challenge of our time. He is right. We live in the richest nation the planet has ever known, yet our infant mortality rate is among the highest in the industrialized world. We are country of such plenty that our presidential contenders build out elevators for their cars, and yet every night 16 million children go to bed hungry even as our stock market hovers at 16,000. We live in a country where the same politicians arguing for unlimited campaign spending by the ultra rich balk at paying our workers a fair wage.
Income inequality is the defining economic challenge of our time. And it's the biggest reason why we need Obamacare. The income gap among the rich and the poor is, if you will, the economy's pre-existing condition that needs a cure. One of the most important factors widening that gap - if not the most important factor - was the disparity in health care cost and affordability among the rich and the poor. The old health care system not only resulted in it being by far the biggest cause of personal bankruptcies, a system could not have performed more efficiently were it designed to intentionally keep poor impoverished and enriching the already-wealthy.
From the very basic levels to the most complex, our old system favored the financially better off. Start with the employer-based insurance system, for example. That system ensured that large corporations will big purchasing power will get better deals from insurance companies than small businesses and individuals. Regulations and laws outlawed pre-existing condition insurance for employer-provided insurance but not for individuals. Not only are those who are employed by large employers likely to be financially better off than those employed by small businesses or the self-employed or the unemployed, even within the employer based system, those making the least would find the insurance offered utterly unaffordable, and be left to their own devices.
Outside the employer system, the condition is even more dire. Those who have a pre-existing health condition could forget about obtaining insurance. Those earning too much to qualify for the current Medicaid programs (which for childless adults is around poorer than dirt poor), but too little to be able to afford their employer's plan or a plan in the private individual marketplace had no choice but to take their chances. Millions of seniors who fell into the Medicare part D coverage gap had to rely on their families to financially help, or go without medicine or food - something that hurt the consumer economy badly.
41 million Americans live with no coverage at all in case they get hit by a bus or affected by a killer disease. Outside the ranks of the uninsured, millions are underinsured - people who carry individual policies that essentially cover nothing of significance - and in case of any large medical expense, they are left abandoned. All of this is to say nothing of the people who find out their insurance will drop them at the precise moment they need them, or have the common precondition known as being female for which insurance companies got to gouge them.
Every single person who works for a large employer but couldn't afford a policy offered by that employer, every individual with a health condition, every small business owner and employee who can't find a willing partner among the insurance companies, every person who purchased a policy only to find it covers nothing and leaves them when they need it, and every woman charged more for the same coverage lives at a disadvantage - at an economic disadvantage.
The inability to get an existing chronic condition treated impacts one's ability to work, earn and contribute - it not only hurts our gross domestic product but the individual initiative that the Right so pretends to love. The small business that has to spend more of its revenue for health care than its large business competitors is put into an unfair competitive disadvantage. The small business that finds health insurance out of reach suffers from a less healthy workforce and a high turnover. The mom who is charged more for her insurance (if she is lucky enough to be able to afford a plan at all) cannot spend that extra money to invest in her own future, or that of her children.
And if we began to count the number of people who are afraid to leave their jobs and start their own business only because of health care, or are forced to work a second job just to get health care, we will be counting for a good long while.
Every single one of those things hurts economic and social mobility. Each one of them widens the gap between the rich and the poor. Each one of those is a social cause shackling those who need a hand up.
And these are the reasons we need Obamacare. The Affordable Care Act makes the concept of quality, affordable health insurance not just a feel-good campaign promise but a right for every American. Because of the Affordable Care Act, insurance companies are no longer allowed to gouge those with a pre-existing condition or to turn them down. Because of Obamacare, women cannot be charged more than men. Because of the ACA, small businesses can band together and shop for deals that only large multinationals could take advantage of until now. Seniors will no longer have to decide whether to buy medicine, buy food, or ask their children for help.
Most importantly, because of Obamacare, tens of millions of Americans will be eligible for tax credits and subsidies to purchase coverage (or be eligible for Medicaid). People in the individual market will be able to pool their purchasing power through exchanges the same way that big businesses do for their employees. No longer will the dream of an entrepreneur be deferred simply because she needs her employer's plan to pay for her child's care. No more will an accident or a diagnosis of a chronic illness put whole families on the streets. The number one cause of bankruptcy will become a footnote in history.
Yes, those benefits are righteous. But those are also perhaps the most important step America can take to break the logjam of our gaping economic inequality and social immobility. Taking the burden of health care off the shoulders of the neediest and holding insurers, employers, and individuals accountable will go a long way towards taking that shackle off our society's feet. It will free entrepreneurs, increase productivity, and level the playing field.
Health reform cannot be separated from what the president called the defining challenge of our time, and that's why for anyone who cares about facing that challenge, the success of Obamacare must be pivotal.