Morning Bell: Don’t Let Co-ops Become a Trojan Horse


According to today’s Washington Post, the Senate Finance Committee will soon produce a health care plan that rejects “a government-run health insurance plan in favor of a network of member-owned cooperatives.” More commonly referred to as “co-ops”, these organizations actually already have a long and proud tradition in many sectors of the U.S. economy, including health care. But Americans must be wary that our nation’s co-op tradition does not become a vehicle for government-run health care.

To some, the word “co-operative” may have a slight Bolshevik whiff to it, but actually a private co-op is nothing more than private individuals exercising their right to voluntarily self-associate. From farm bureaus to barn-raisers, private co-ops are part of American society. In the realm of health care, a group that organizes coverage provided by private insurers could be structured as a co-op. Or the health insurer itself could be a co-operative owned by its member policyholders. Those kind of insurance companies are called mutual insurers.

Understood in this manner, co-ops have far more to do with Edmund Burke and little platoons than with Leon Trotsky and manning the barricades. And they can be part of the health care solution.

But, don’t be fooled; Burkean little platoons are not what the Obama Administration and its allies in Congress have in mind. In liberal Washington today, leaders such as Sen. Chuck Schumer (D-NY), are talking up co-ops that would be:

  • Run by the government, preferably the federal government
  • Funded or subsidized by the government, or
  • Includes plans chosen by the government.

A co-op with any of these three features is obviously unacceptable. A real co-op is:

  • Run by its members,
  • Funded by its members and other private sources, and
  • Controlled by its members.

Why is the left fastening to co-ops now? Because their public plan idea—a way for the government to take over health care—has run into a buzz saw of opposition among the American people. Liberals have concluded, it seems, that there’s more than one way to skin a cat. So if the public plan was a Trojan horse for single-payer (which means a complete government takeover of your health care decisions), a co-op (the way liberals mean it) is a Trojan horse for a public plan.

Congress should, of course, be empowering true local, private co-ops to be a real health choice for Americans. To do that, Congress needs to amend the tax laws to do two things: Allow mutual insurance companies to be the foundation of non-profit insurance companies; and give people the same tax breaks for getting insurance from a co-op as from their employer.

None of this is, however, what some leading members of Congress have in mind when the subject of co-ops comes up.

Quick Hits:

  • The House Appropriations Committee, at its own initiative, added to the 2010 Defense appropriations bill another $132 million for two elite Gulfstream jets for ferrying Members of Congress around the country.
  • According to a economic analysis by the Associated Press, Cash for Clunkers “steals economic growth from the future.”
  • Also according to the AP, Obamacare would allow a government-sponsored insurance plan to cover abortions.
  • ABC News stopped by a health care townhall and found: “the hundreds of Eastern Maryland residents who packed the school’s auditorium loudly refuted the notion that their anger over the Democrats’ health care reform plans is ‘manufactured.’”
  • According to Rasmussen Reports, 71% of U.S. voters say President Obama’s policies have increased the size of the federal deficit.