Here’s half of the basic problem:

Health care costs keep growing faster than our baseline inflation.  Within that inflation number the cost of insurance is inflating faster than the overall health care inflation rate.  I.e., insurance companies are jacking up premiums (and profits?) faster than their costs are going up.

The other ‘half’?  We’re already paying twice as much as we should.

So health care reform cost control measures must not only reduce the rate of growth, they have to cut the baseline costs — radically.

So far we’re not seeing in the various Congressional bills anything that really whacks away at total cost.

Here’s a ‘live’ oil price tracker. Move your cursor across the tabs on the bottom for the 1 month/quarter/year/5year charts.

A return to a steady climb in crude prices will squeeze our anemic economy hard and could choke off health care reform.

We are frequently chided — usually by ‘free market’ folks on the right — that we need to trust the market to manage health care.  To do otherwise is to head directly toward socialism and inefficient goverment.

Nobel economist and New York Times columnist Paul Krugman more than disagrees.  He outlines in his blog the reasons why the market cannot manage health care. Wonkish or not, this blog entry has, so far, drawn more than 800 comments plus a whole diary line on Daily Kos.

Two of his points:

…paying for your health care is a loss from an insurers’ point of view - they actually refer to it as “medical costs.” This means both that insurers try to deny as many claims as possible, and that they try to avoid covering people who are actually likely to need care. Both of these strategies use a lot of resources, which is why private insurance has much higher administrative costs than single-payer systems. And since there’s a widespread sense that our fellow citizens should get the care we need - not everyone agrees, but most do - this means that private insurance basically spends a lot of money on socially destructive activities.

The second thing about health care is that it’s complicated, and you can’t rely on experience or comparison shopping. (”I hear they’ve got a real deal on stents over at St. Mary’s!”) That’s why doctors are supposed to follow an ethical code, why we expect more from them than from bakers or grocery store owners.

Krugman notes that  the remarkable comment string points to a public hunger for explanations, not just sales slogans.  I agree.

For all of us politics junkies, the saga of health care on the Hill is all day, every day pleasure.

Now it appears that Speaker Pelosi, whom I continue to judge to be far more substantive and powerful than the commentariat would have it, is committed to moving a bill.  This Washington Post piece is a useful survey of the various positions and pressures among Democrats.

And the estimable Paul Krugman outlines his argument what the Blue Dog Democrats are wrong.  He calls them incoherent.

I find too little thinking among economists about the obvious cross ties between our economy and the health care sector.  At the very least we need to remember the linkage between a collapsing economy and health care cost reform: economy in trouble =’s health care reform in trouble.  Vice versa is true, too.

Here’s a wonkish review by a leading economist, Simon Johnson, of what he sees as our failure to rein in the out-of-control finance sector.

It is important to know what the opposition is doing & saying — and even more important to understand the mindset behind those actions. Jump down to “Read the rest…” for the text of a long e-mail circulating today.

Go to this NewsHour segment with commentators David Brooks and Mark Shields for a useful survey of how the health care sales arena is shifting from the Congress to the public at large.  TV ads are already everywhere.

Notable here in WA is the coherence and vigor of the Washigton state Republican opposition.  And here is the national Republican game plan.

And for you real junkies, here is our joint Senate-House health care committees’ work session yesterday — lots of fireworks between advocates and Republican opposition.

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bad news in London

Here’s a warning: the British economic collapse is not slowing down as expected.  Reports the Guardian:

Dashing hopes that the steepest decline in growth since the 1930s might be nearing an end, the Office for National Statistics said gross domestic product fell by 0.8% in the three months to June.

The size of the drop surprised the City, which had expected only a 0.3% decline following recent signs of a pickup in the housing market and strong growth in high street spending.

Those are the same hopes fueling the feeling around the US that this is nearly at an end.  Maybe not.

If our numbers also come in more grim than expected, we could see some serious reverberations, including setbacks to health care reform.

Update: Here’s the Washington Post survey of the hopeful — and not so hopeful — signs here. Me? I doubt our economy is able to run opposite to the Brits.  We connect tightly in the finance world, the epicenter of the problems that drive this crisis.