We won't have the full data on 2014 until next year's census report, but multiple independent surveys show a sharp drop in the number of Americans without health insurance, probably around 10 million, a number certain to grow greatly over the next two years as more people realize that the program is available and penalties for failure to sign up increase.
It's true that the Affordable Care Act will still leave millions of people in America uninsured. For one thing, it was never intended to cover undocumented immigrants, who are counted in standard measures of the uninsured.
Furthermore, millions of low-income Americans will slip into the loophole Roberts created: They were supposed to be covered by a federally funded expansion of Medicaid, but some states are blocking that expansion out of sheer spite. Finally, unlike Social Security and Medicare, for which almost everyone is automatically eligible, Obamacare requires beneficiaries to prove their eligibility for Medicaid or choose and then pay for a subsidized private plan. Inevitably, some people will fall through the cracks.
Still, Obamacare means a huge improvement in the quality of life for tens of millions of Americans – not just better care, but greater financial security.
And even those who were already insured have gained both security and freedom, because they now have a guarantee of coverage if they lose or change jobs.
What about the costs? Here, too, the news is better than anyone expected. In 2014, premiums on the insurance policies offered through the Obamacare exchanges were well below those originally projected by the Congressional Budget Office, and the available data indicates a mix of modest increases and actual reductions for 2015 – which is very good in a sector where premiums normally increase five percent or more each year.
More broadly, overall health spending has slowed substantially, with the cost-control features of the ACA probably deserving some of the credit.
In other words, health reform is looking like a major policy success story.
It's a program that is coming in ahead of schedule – and below budget – costing less, and doing more to reduce overall health costs than even its supporters predicted.
Of course, this success story makes nonsense of right-wing predictions of catastrophe. Beyond that, the good news on health costs refutes conservative orthodoxy. It's a fixed idea on the right, sometimes echoed by ''centrist'' commentators, that the only way to limit health costs is to dismantle guarantees of adequate care – for example, that the only way to control Medicare costs is to replace Medicare as we know it, a program that covers major medical expenditures, with vouchers that may or may not be enough to buy adequate insurance. But what we're actually seeing is what looks like significant cost control via a laundry list of small changes to how we pay for care, with the basic guarantee of adequate coverage not only intact but widened to include Americans of all ages.
It's worth pointing out that some criticisms of Obamacare from the left are also looking foolish. Obamacare is a system partly run through private insurance companies (although expansion of Medicaid is also a very important piece). And some on the left were outraged, arguing that the program would do more to raise profits in the medical-industrial complex than it would to protect American families.
You can still argue that single-payer would have covered more people at lower cost – in fact, I would. (Dear Mr. Krugman, I would challenge the "lower cost" concept, but single-payer would cover more people providing primary care.) But single-payer wasn't on the table; only a system that appeased insurers and reassured the public that not too much would change was politically feasible. And it's working reasonably well: Competition among insurers who can no longer deny insurance to those who need it most is turning out to be pretty effective. This isn't the health care system you would have designed from scratch, or if you could ignore special-interest politics, but it's doing the job.
And this big improvement in American society is almost surely here to stay. The conservative health care nightmare – the one that led Republicans to go all-out against Bill Clinton's health plans in 1993 and Obamacare more recently – is that once health care for everyone, or almost everyone, has been put in place, it will be very hard to undo, because too many voters would have a stake in the system. That's exactly what is happening. Republicans are still going through the motions of attacking Obamacare, but the passion is gone. They're even offering mealymouthed assurances that people won't lose their new benefits. By the time Obama leaves office, there will be tens of millions of Americans who have benefited directly from health reform – and that will make it almost impossible to reverse. Health reform has made America a different, better place.
FINANCIAL REFORM
Let's be clear: The financial crisis should have been followed by a drastic crackdown on Wall Street abuses, and it wasn't. No important figures have gone to jail; bad banks and other financial institutions, from Citigroup to Goldman, were bailed out with few strings attached; and there has been nothing like the wholesale restructuring and reining in of finance that took place in the 1930s. Obama bears a considerable part of the blame for this disappointing response. It was his Treasury secretary and his attorney general who chose to treat finance with kid gloves.
It's easy, however, to take this disappointment too far. You often hear Dodd- Frank, the financial-reform bill that Obama signed into law in 2010, dismissed as toothless and meaningless. It isn't. It may not prevent the next financial crisis, but there's a good chance that it will at least make future crises less severe and easier to deal with.
Dodd-Frank is a complicated piece of legislation, but let me single out three really important sections.
First, the law gives a special council the ability to designate ''systemically important financial institutions'' (SIFIs) (Note: Hello? as far as I'm concerned, my checkbook is a systemically important financial institution!)– that is, institutions that could create a crisis if they were to fail (Note - like my checkbook~!)– and place such institutions under extra scrutiny and regulation of things like the amount of capital they are required to maintain to cover possible losses. This provision has been derided as ineffectual or worse – during the 2012 presidential campaign, Mitt Romney claimed that by announcing that some firms were SIFIs, the government was effectively guaranteeing that they would be bailed out, which he called ''the biggest kiss that's been given to New York banks I've ever seen.''
But it's easy to prove that this is nonsense: Just look at how institutions behave when they're designated as SIFIs. Are they pleased, because they're now guaranteed? Not a chance. Instead, they're furious over the extra regulation, and in some cases fight bitterly to avoid being placed on the list. Right now, for example, MetLife is making an all-out effort to be kept off the SIFI list; this effort demonstrates that we're talking about real regulation here, and that financial interests don't like it.
Another key provision in Dodd-Frank is ''orderly liquidation authority,'' which gives the government the legal right to seize complex financial institutions in a crisis. This is a bigger deal than you might think. We have a well-established procedure for seizing ordinary banks that get in trouble and putting them into receivership; in fact, it happens all the time. But what do you do when something like Citigroup is on the edge, and its failure might have devastating consequences? Back in 2009, Joseph Stiglitz and yours truly, among others, wanted to temporarily nationalize one or two major financial players, for the same reasons the FDIC takes over failing banks, to keep the institutions running but avoid bailing out stockholders and management. We got a chance to make that case directly to the president. But we lost the argument, and one key reason was Treasury's claim that it lacked the necessary legal authority. I still think it could have found a way, but in any case that won't be an issue next time.
A third piece of Dodd-Frank is the Consumer Financial Protection Bureau. That's Elizabeth Warren's brainchild, an agency dedicated to protecting Americans against the predatory lending that has pushed so many into financial distress, and played an important role in the crisis. Warren's idea was that such a stand-alone agency would more effectively protect the public than agencies that were supposed to protect consumers, but saw their main job as propping up banks. And by all accounts the new agency is in fact doing much more to crack down on predatory practices than anything we used to see.
There's much more in the financial reform, including a number of pieces we don't have enough information to evaluate yet. But there's enough evidence even now to say that there's a reason Wall Street – which used to give an approximately equal share of money to both parties but now overwhelmingly supports Republicans – tried so hard to kill financial reform, and is still trying to emasculate Dodd-Frank. This may not be the full overhaul of finance we should have had, and it's not as major as health reform. But it's a lot better than nothing.
THE ECONOMY
"...when a panel of economic experts was asked whether the U.S. unemployment rate was lower at the end of 2010 than it would have been without the stimulus, 82 percent said yes, only two percent said no."
Barack Obama might not have been elected president without the 2008 financial crisis; he certainly wouldn't have had the House majority and the brief filibuster-proof Senate majority that made health reform possible. So it's very disappointing that six years into his presidency, the U.S. economy is still a long way from being fully recovered.
Before we ask why, however, we should note that things could have been worse. In fact, in other times and places they have been worse.
Make no mistake about it – the devastation wrought by the financial crisis was terrible, with real income falling 5.5 percent. But that's actually not as bad as the ''typical'' experience after financial crises: Even in advanced countries, the median post-crisis decline in per- capita real GDP is seven percent. Recovery has been slow: It took almost six years for the United States to regain pre-crisis average income. But that was actually a bit faster than the historical average.
Or compare our performance with that of the European Union. Unemployment in America rose to a horrifying 10 percent in 2009, but it has come down sharply in the past few years. It's true that some of the apparent improvement probably reflects discouraged workers dropping out, but there has been substantial real progress.
Meanwhile, Europe has had barely any job recovery at all, and unemployment is still in double digits. Compared with our counterparts across the Atlantic, we haven't done too badly.
Did Obama's policies contribute to this less-awful performance? Yes, without question. You'd never know it listening to the talking heads, but there's overwhelming consensus among economists that the Obama stimulus plan helped mitigate the worst of the slump. For example, when a panel of economic experts was asked whether the U.S. unemployment rate was lower at the end of 2010 than it would have been without the stimulus, 82 percent said yes, only two percent said no.
Still, couldn't the U.S. economy have done a lot better? Of course. The original stimulus should have been both bigger and longer. And after Republicans won the House in 2010, U.S. policy took a sharp turn in the wrong direction. Not only did the stimulus fade out, but sequestration led to further steep cuts in federal spending, exactly the wrong thing to do in a still-depressed economy.
We can argue about how much Obama could have altered this literally depressing turn of events. He could have pushed for a larger, more extended stimulus, perhaps with provisions for extra aid that would have kicked in if unemployment stayed high. (This isn't 20-20 hindsight, because a number of economists, myself included, pleaded for more aggressive measures from the beginning.) He arguably let Republicans blackmail him over the debt ceiling in 2011, leading to the sequester. But this is all kind of iffy.
The bottom line on Obama's economic policy should be that what he did helped the economy, and that while enormous economic and human damage has taken place on his watch, the United States coped with the financial crisis better than most countries facing comparable crises have managed. He should have done more and better, but the narrative that portrays his policies as a simple failure is all wrong.
While America remains an incredibly unequal society, and we haven't seen anything like the New Deal's efforts to narrow income gaps, Obama has done more to limit inequality than he gets credit for. The rich are paying higher taxes, thanks to the partial expiration of the Bush tax cuts and the special taxes on high incomes that help pay for Obamacare; the Congressional Budget Office estimates the average tax rate of the top one percent at 33.6 percent in 2013, up from 28.1 percent in 2008. Meanwhile, the financial aid in Obamacare – expanded Medicaid, subsidies to help lower-income households pay insurance premiums – goes disproportionately to less-well-off Americans. When conservatives accuse Obama of redistributing income, they're not completely wrong – and liberals should give him credit.
