How Health Care Stole Your Pay Raise

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This amazing graph bouncing around the web is the most striking example of why health care reform isn't just about reforming care. It's about reforming the economy. New bumper sticker: "Reform Health Care; Get a Raise!"


healthcaregraph1.png

In layman's terms, the hard blue line is the expected growth in average wages. The dashed-purple line is what's actually appearing in workers' wallets, which is average wages minus health premiums. In other words, health care is robbing you of your bonus.

So why aren't workers rallying in the streets for health care reform? They don't see this graph. Instead, as Ezra points out, they see their wages stagnating and chalk it up to a stagnant economy, a stagnant company, or a stingy boss.


But this is exactly why it's a bit cheeky to present graphs like this (via Greg Mankiw) as evidence that Americans are inherently reluctant to pay for health reform.

healthpoll1.pngSo long as this issue is presented as "Pay for health care reform" vs. "Don't pay for the status quo," we're skirting the main issue here. We are paying for the status quo. Every year, in our paychecks alone we are paying for the cost of doing nothing, to the tune of about $5,000 per worker per year. How about a poll that presents the first graph and asks respondents: "This is what will happen to your wages, and the wages of your children, as health premiums continue their predicted climb. Is that a system to you want to preserve? Please answer yes, no or unsure."
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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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