Forget WH Assurances: The Public Option Would Crush Private Competition

As Washington struggles to figure out what went wrong with Obamacare, and what will become of its centerpiece -- the public option -- much of the focus has been on the strategy, or lack thereof, for passing this complex legislation.

Should the White House have waded into this debate earlier and made clear that the public option was a sine qua non of health care reform?

Should Democrats have pushed the comparatively radical Medicare-for-All proposal of its Progressive caucus, understanding that the public option would be a negotiated fall-back?

Should the White House have pushed reform and the public option on moral grounds, rather than as cost savings devices?

All are legitimate questions.  But this inside-baseball strategic debate misses perhaps the central variable in Obamacare's collapse -- the public option must sound incredibly odd to those citizens who do not spend their lives thinking about politics.  In other words, as progressives rush to defend the public option, it is easy to forget just how weird their key proposal likely appears to the town-hallers.

Consider the arguments of Rep. Anthony Weiner (D-NY).  Earlier this week, he made the cable television rounds to defend the public option.  Against the charge that the public option would crush private insurance companies, Weiner responded that such an outcome would be acceptable because that is how competition works.

The problem for Weiner and the liberals demanding a public option is that this is not how competition works.  At least not as understood by the vast majority of privately employed Americans.

I imagine that the middle-class Americans Obama is so eager to win back hear this argument and wonder:

If that is how competition works, then why not promote government run airlines and auto manufacturers to keep those private industries honest?  For that matter, why not get into the hamburger business to discipline McDonald's and Burger King?

What Weiner and the left argue matter of factly -- that it is entirely consistent with free markets to have the government providing services in competition with private industry -- has to sound off-the-wall when pitched to citizens at these town hall meetings.  When defended openly and aggressively, as Democrats are defending it now, the public option appears fundamentally at odds with the understanding of free markets and liberal societies experienced and expected by the vast majority of Americans.  The government should be in the business of providing public goods that private industry cannot provide.  But it emphatically should not be in the business of competing with private industry.  As the polling indicates, this expansive understanding of the government, as not only a market regulator but as a market actor and creator, is proving a tough sell to an American public that goes to Best Buy and finds Toshiba and Sony competing with each other and providing decent products, even absent a government-option in the television market.

With progressives taking the lead in selling the public option, it has become ever more clear that the difficulties for Obamacare are far too significant to be solved by some shift in strategy.  The problem for the left is not merely overcoming the fear (Democrats would argue the misconception) of citizens that the public option will displace existing health coverage with inferior care and a higher tax burden.   And their problem isn't in the selling.  The problem is that with their attempt to have government competing with private companies, Democrats are pushing a foreign sounding product that the American people just won't buy.

And no amount of Washington strategery is going to change that.