A third of Americans under the age of 65 went without health insurance at some point in the last two years. According to data released by the US Census Bureau last August, 47 million Americans had no health insurance. Precise figures for today are unavailable but it is fairly safe to assume, from statistics relating to unemployment and household wealth, that at least 20% of Americans can no longer afford any kind of health care coverage at all.
While the Obama Administration is dedicated to expanding the scope of health care, qualitatively and quantitatively, its stated objective of setting aside $634 billion over 10 years is both ideologically flawed and fundamentally unrealistic. In fact, for all practical purposes, rising medical expenditures are destined to further erode family surpluses through 2009, thus impacting directly on the American consumer’s ability (let alone willingness) to spend on items like new cars, restaurant meals, summer holidays and entertainment. “The housing stimulus has no chance of working effectively if family balance sheets don’t improve,” said an anti-poverty activist in a web posting yesterday. “And if basic and advanced medical costs go any higher, the working poor will be surviving on a day-to-day basis only.” But who cares about the working poor?
In fact, regardless of the official employment forecasts, what America is witnessing for the first time is the consolidation of a “working poor” class, to specifically include those who actually have jobs (and families with two jobs) but whose debt servicing ability stands seriously impaired. Social justice demands the guarantee of blanket health care coverage, for a nominal cost to those who cannot afford to pay their premiums, and for no cost to those who are at the bottom end of the poverty scale, i.e. annual income of $21,200 and lower.
A minimum of 48 million adults and 21 million children in America have been without health care coverage for six months; the outlook is bleak, particularly within the context of a potential worsening of the national jobless rate, despite the Obama stimulus plans. To make matters worse, the health care allocations in the Obama budget are not final by any means, unlike what many observers are being led to believe. Whether the “blueprint” ever becomes a reality depends upon the reaction of several interest groups, e.g. insurers, doctors, drug companies, hospitals and small businesses.
In the 1990s, the much-touted health care bill carefully crafted by Bill Clinton (and Secretary Clinton) went nowhere. “There were too many competing factors, and Congress did no have the will to legislate socialism,” a former Hillary Clinton campaign manager told CNN over the weekend. But socialist considerations apart, social justice, if not social equality, cannot be achieved without universal health care.
Speaking of social equality, the sooner America’s workers (and those seeking work) realize that they are solidly entrenched in the lowest echelons of the class divide, the better. And, quite unfortunately, sharpening class divisions, under capitalism or European-style socialism, actually facilitate corporate profits. “Let me make this clear, our brand of socialism is very good for business,” a Munich-based board member of BMW declared at a conference of European industrialists shortly after the unification of Germany. The Obama brand of socialism should also turn out to be good for America’s elite corporations, once the dust settles.
The working poor and the poorest may not be able to contribute to consumer demand; however, they can be safely ignored. At current stock price levels, numerous components of the S&P 500 are already positioning themselves to restate their earnings and to attract long term investors on the basis of restated asset valuations.
In other words, Wall Street does not need to fear Obama Socialism, since that variety of socialism will fall far short of meeting either lofty social justice targets or social equality thresholds. Wall Street does not need to fear food riots either, given the element of sheer hope which has filtered through the inner cities, the industrial wastelands and the six-million-odd undocumented migrants ever since Barack Obama won the presidential election; in any event, the government is quite well equipped to control street unrest.
What Wall Street needs to be concerned with exclusively is the ability of Washington regulators and lawmakers to recognize and control systemic risks, something which has been highly unquestionable thus far. A new class matrix will be acceptable to business, as long as the core financial fabric, driving the capital accumulation process, remains in intact.