In his speech to the AMA yesterday, President Obama decried criticism of a public health plan as partisan paranoia.  “What are not legitimate concerns,” he said, “are those being put forward claiming a public option is somehow a Trojan horse for a single-payer system. ”

Not legitimate?  Well, let’s see.  A “Trojan Horse,” of course, refers to the legend of the Trojan war in which a giant horse was delivered as a gift to the city of Troy, but which in fact held the city’s destruction.  In the President’s view, then, critics of the health plan would suggest that the plan, which is presented as a supplement, even a compliment, to the current (free-market) system, in fact is a means of the current system’s undoing.  Fair enough.  So, are those critics wrong, as Obama is suggesting they are?

Well, let’s simply examine the surface.  Something, perhaps, the Trojans would have done well to consider.  What is its function, its purpose?  Does it do the job it is purported to do, or is it hollow enough to be hiding destruction in its guts?  Now, when we’re looking, it’s important to remember that it’s still under construction.  What we’ve been privvy to are the public discussions of that construction.  That information which is being allowed to slip out.

What we know is that Obama wants a plan that involves a public health option.  A government-run, taxpayer-subsidized, publicly available insurance.  This plan would be inserted into the current market, ostensibly to provide care for those who need it and can’t get it elsewhere, and to compete with the private firms, to “encourage” them to create better, more affordable plans. 

There is a reason Conservatives strongly discourage government entry into the free-market system.  It creates monopolies.  This is something that even a community organizer should be able to understand.  And, even if not Obama himself, at least somebody on his financial staff understands how monopolies work.  And, I’m sure, the conversation has come up.  Democrats love discussing monopolies, after all; it helps define the enemy for the drudges of the class war.  Surely, they understand how monopolies are made.

In short, here’s the problem: it creates an unlevel playing field in the marketplace.  On the Capitalist side, you have privately funded groups which are in business to make a profit for themselves and for their stockholders.  Insurance is hard work; nobody does it for free.  The capitalist system is built on making profit.  That’s how companies stay afloat.  And, surely, Obama (who assures us, after all, that a public health plan is NOT designed to destroy the free market) wants these companies to stay afloat… right?  On the other side, though, you have the “Public” health plan.  A plan that is government sponsored, which means, in many cases, taxpaying Americans are already paying for it, even if they aren’t using it.  Further, this plan is a government beaurocracy — designed specifically to not make a profit, and being operated by government employees who, by and large, get paid less than free-market executives (after all, why become an executive if it doesn’t pay well?).  Plus, as with all government entities, should it fail to meet the bottom line (in this case, to simply cover operating expense), it has the benefit of being taxpayer-funded, so the government will simply foot the bill.  This will, of course, sink the US further into debt, but that’s neither here nor there.

Obama has said the idea is to get the private Health industry to compete with this new government monster.  What he has not said is that such competition is impossible.  You don’t compete against somebody who’s holding all the cards.  You’re not even in the game.  This new “competitor” in the healthcare industry will have the power to make all the rules in the game, will have no stockholders to be held accountable by, no need for profit, or even sustainability.  And the President thinks the private industry will compete how?

The truth is, he doesn’t.  The truth is, he knows damned well what a publicly-funded system will do to the private industry.  He knows that what he’s presenting as a boon and a gift to free-market healthcare, in fact houses a bellyfull of destruction — and that, when the dust settles, there will be one entity standing.  A single-payer government system.

Reuters’ James Pethokoukis isn’t fooled.  As he pointed out yesterday: