Schip Howlers

When children become political props.

Wall Street Journal
Saturday, October 13, 2007 12:01 a.m.

After President Bush vetoed Congress's major expansion of the State Children's Health Insurance Program, Nancy Pelosi declared: "President Bush used his cruel veto pen to say, 'I forbid 10 million children from getting the health benefits they deserve.' " As far as political self-parody goes, that one ought to enter the record books.

It's wrong on the facts, for one, which Speaker Pelosi knows. The Schip bill was not some all-or-nothing proposition: A continuing resolution fully funds the program through mid-November, so none of the 6.6 million recipients will lose coverage. And even if Washington can't agree by then, there will be another stopgap, because Schip might as well already be an entitlement. In truth, the Bush Administration endorses a modest expansion. A majority of Congress backs a much larger expansion. The controversy is over the role of government in health care.

The 10 million children that Ms. Pelosi cites are the sum of the current enrollees plus those who could join under the Democratic plan (which also has the support of some wayward Republicans). Never mind that up to 60% of these children already have private insurance, which Schip would displace as it moves up the income scale. Only by Beltway reasoning could "not expanding" count as "denying" public assistance. Hillary Clinton went further and said the President was actively "stealing" health care from needy kids.

Despite all that, after his veto Mr. Bush repeatedly signaled a willingness to compromise and spend more than the $5 billion he would prefer to pump in--which is by itself a 20% expansion. His offer has been spurned flatout, and an override vote is scheduled for next week. Despite their howls about "the children," Democrats and their media partners are happy to milk them for political gain.

Unfortunately, that narrative was bolstered this week by some conservative bloggers. After the Schip veto, Democrats chose a 12-year-old boy named Graeme Frost to deliver a two-minute rebuttal. While that was a political stunt, the Washington habit of employing "poster children" is hardly new. But the Internet mob leapt to some dubious conclusions and claimed the Frost kids shouldn't have been on Schip in the first place.

As it turns out, they belonged to just the sort of family that a modest Schip is supposed to help. One lesson from this meltdown is the limit of argument by anecdote. The larger point concerns policy assumptions. Everyone concedes it is hard for some lower-income families like the Frosts to find affordable private health coverage. The debate is over what the government should do about it.


The Democratic position is clear: Expand a government program and all will be cured. Mr. Bush's position recognizes that a subsidy like Schip is necessary is some cases because of government mandates and overregulation. Congress and the states consistently enact health-care policies that make insurance coverage more expensive, and then they wonder why people have trouble paying for it.

In a more rational world, liberals would embrace the health-care tax reforms that Mr. Bush advocates. The employer-based insurance tax deduction is a wealth transfer to those who need it least--the most affluent, with the most gold-plated plans. It launders health dollars through a third-party bureaucracy that encourages people to spend, reducing access and raising prices for the uninsured. On equity grounds alone, Democrats should support changing these incentives.

That they don't, or won't, suggests ulterior political motives, and that's where Schip comes in. All Democratic "universal" health-care plans combine more government subsidies with more coverage mandates. Today's Schip expansion is the down payment for 2009, when they want to extend it well into the middle class. The fact that there are better, and more economic, policies to cover more people is less important than getting ever more Americans on the government health care tab.

As for the GOP's Schip fans, most of them understand this but also don't want to be portrayed as voting against "children." Senators Orrin Hatch and Chuck Grassley were especially slippery in their letter to us yesterday in dodging any answer to our critique of the bill's $30 billion funding ruse. The bill includes a funding "cliff" that abruptly cuts off the higher spending in year five to conceal its true future costs under Congressional budget rules. It's precisely such fiscal fraudulence that cost Republicans their Congressional majority last year. Overriding Mr. Bush's veto won't help them get it back.