Last Updated 11 Feb 2020

Normative Economics

Category economics
Essay type Research
Words 1676 (6 pages)
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Republican and democratic candidates in the upcoming elections have tabled proposals on how to reform healthcare in the country. They all agree on need for reforms but differ on the proposed action. The debate has been sparked by reports indicating that many Americans are uninsured. According to U.S census bureau, 47 million Americans were uninsured in 2006 up from 44.8 million in 2005. An increase of 22 million or 15.8%. The proportion of the insured by government schemes also went down from 27.3% to 27.0% in that year ( 2007).  A report by families USA puts the figures much higher. It indicates that 89.6 million Americans below 65 years of age were uninsured at time in the last two years. ( These figures show that there really is a health insurance crisis in the country. This is by far biggest subject of the health reform debate in the country.

Republicans propose that the government provide incentives for the poor to get private life insurance. They oppose government playing on active role in provision of insurance cover. The Democrats on their part advocate for a universal health care plan. Their proposals require that everybody must get covered.


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Democrats have a better health reform agenda than the Republicans. The Democrats proposal to make health care affordable and accessible to all Americans is better than the republican proposal, which offer, subsidizes low-income families.

Proponent’s Position.

Democrats propose that to reform the health sector the government must come in to promote accessibility by all Americans through universal coverage. (, 2007)

Opponent’s Position

Republicans emphasize on reforms in healthcare based on free market principles they would offer incentives to the people to taking private life insurance policies. (, 2007)

Proponent’s Position

Democrats have come up with a plan that ensures that everybody is covered and paying a premium that is within their means. They support a universal health care plan. The health plan targets the uninsured and those not satisfied with their current insurance. Senator Hillary’s American Health Choices Plan requires that the government and big employees make contribution to the employee’s health plan. Small businesses on their part will be let off. They wont contribute but will in fact receive tax credits so that they are able to cover their employees.

Under the AHCP, insurance and drug companies will use be highly regulated. Insurance companies will not deny anybody cover due to a pre-existing condition for they foresee somebody falling sick. The drug manufacturers will be pushed to lower the cost of medication. She identifies the greed of these two industries as a major limiting factor to affordable health care for all.

 In the AHCP, individuals must get insured. It is called ‘choices’ plan as it allows one to choose whether to retain current cover or get into the one provided by government. Individuals will pay a premium that is within their means. To keep the premiums low, they will be capped to correspond to individual’s income. This way nobody will be required to pay more than they can afford. The plan also avails tax credit to working families. That way, they are able to access quality insurance cover. The plan also aims at expanding Medicaid and children’s health insurance program to reach more people.

John Edwards, another Democratic candidate unveiled almost similar plan to that of Senator Clinton. It also agitates for universal coverage with employers to government making contribution. The plan is also mandatory for all Americans. (, 2007). To fund these grand plans, the candidates have indicated that they will rescind tax breaks and subsidies to insurance providers. Senator Clinton also requires that large employers make contribution towards their employee’s health cover. Her plan also emphasizes on cost cutting through increased efficiency and use of preventive medication

Strengths of The Democrats’ Proposal.

The proposed universal health care plans ensures that everybody affords insurance cover Senator Clinton’s AHCP ensures that every body is covered and paying an affordable premium. It makes it mandatory for all people to get health insurance coverage but allows them the choice of their policy. This way it does not force one in to buying insurance cover they are not comfortable with.

The proposed plan also ensures that nobody is denied insurance coverage. Insurance providers are obliged to provide cover for all without discrimination on the grounds of a pre-existing condition or in anticipation of illness. This brings in a big number of people who were shunned by insurance companies due to condition such as schizophrenia and HIV/ AIDS. (, 2007)

The plan does not require small businesses to contribute to the universal health care plan rather it grants them tax credits. This way the employees of these small businesses stay afloat. This will be incentive for small businesses to expand.

The AHCP also emphasizes on cost cutting in health care. It champions preventive measures that are cheaper than curative medication. It also champions greater efficiency and modernization in health care delivery that would bring down costs


The universal health plan requires huge funding and this may result to higher taxes for the American public. Senator Clinton puts the cost of her plan at $110 billion while John Edward put his at $120 billion. The figure is tentative and might go higher than that. The planned source may also not deliver as much funds as projected senator Clintons plan to generate savings by boosting efficiency may also not generate enough funds. This would leave only the options of a tax rise as John Edwards concedes. ( Higher taxes will burden the public further and will not be welcome.

Government involvement will cause inefficiencies in service delivery. Government involvement will only lead to a huge bureaucracy with a lot of red tape. This might aggravate the crisis. Without a profit motive, he plan might offer sluggish and poor quality services

Opponents’ position

Republican candidates propose that the government subsidize low-income families to help them access health care rather than providing a universal plan as a way to enhance accessibility. The Republican are opposed to government involvement in provision of health insurance. (, 2007)

Rudy Giuliani, a Republican candidate in his plan offers tax deductions of $15,000 to families and $7500 for individuals. These deductions will enable families to access health care. He also proposes to give families and individuals vouchers to buy policies. He would encourage individuals buy covers of their choice as a way to make savings. Individuals would have to pay for minor check-ups as they would to their cars. He also stressed the need for people to take care of their health and not leave it to the government. (Elliott, Philip, 2007)

Mitt Romney is agitating for individuals to purchase private insurance. He stresses that government interference will worsen the situation. He proposed tax breaks but not universal coverage plan. That would push up taxes. (, 2007)

The Republican propose that health insurance should be left to individual’s choices rather than employer and government schemes. They offer what they call an American solution to the problem. They stand for free market principles and are opposed to socialist tendencies in health care. They do not require that everybody must have health insurance cover. They justify try to create an incentive for individuals to join.

Strengths of The Republicans proposals

The Republican proposals ensure that the freedom of choice of consumers is safeguarded. Since they know their health better, individuals will decide on which policy in the market suits them best.

Health saving plans as proposed by republicans will encourage individuals to save for future health expenses. This will promote more health lifestyle among the people. The insured gain more control over the financing of their health care.

Tax deductions and vouchers would enable a big number of people to access quality health care. Neither would they disrupt health care delivery the way universal plan would. These fiscal measures are actually being implemented and would not be experimental.

The republican proposals are business friendly in that they do not require large employers to make huge contributions to their employee’s health covers

They also come up with a health care service that is free of long bureaucratic procedures. Different insurance providers will compete to provide the most efficient and customer friendly covers. (


The republicans fail to address the issue rising medical costs and rising insurance premiums. They give the insurance companies a free hand that results in only higher policies.

The subsidies offered may not be adequate to male health insurance cover affordable to all people. This will lead to part of the population remaining uncovered.

Most of the proposals made are similar to those implemented under the Bush administration. They are not offering any new solutions to the persisting problems of skyrocketing premiums and medical costs. They emphasize on free market principles that have put the countries in its current predicament.

The republican proposals do not tackle the issue of discrimination by the insurance industry insurance providers are not obligated to cover people with pre-existing conditions. Vouchers will not be of any use to such people as they will not get covers anyway


The democrats’ health agenda is definitely better than the republican agenda on health. It talks the failures of the healthcare system in place today. The democrats have tabled plans on how to make health care more affordable and accessible that are more convincing. They require that every body be covered while leaving rooms for choice on the policy. Their plan covers everybody and also ensures that the premiums are affordable.

The net wise in taxes will not be huge as the cost of not implementing the plan. When sick people cannot pay for their health cover the community will have to bear the burden.

Universal coverage has been implemented in other advanced countries and would also improve health care in the US.


Highlights, 2007. Health insurance coverage: 2006. Retrieved on 04/10/07 from

A Healthcare That Works for Everybody, 2007. Retrieved on 04/10/07 from

Making Healthcare Affordable to all Americans, 2007. Retrieved on 04/10/07 from

American Health Choices Plan, 2007. Hillary for president. Retrieved on 04/10/07 from

Healthcare, 2007. Retrieved on 04/10/07 from

Mayor Rudy Giuliani’s health plan, 2007. Retrieved on 04/10/07 from

Mitt Romney on Healthcare, 2007. Retrieved on 04/10/07 from

Elliott, Philip, 2007. Giuliani: Dems Want Nanny Government. Retrieved on 04/10/07 from

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