There Should Be a Public Option for Everything

Editors’ Note: Excerpted from the July 7, 2019, New York Times.  Sometimes it simply depends upon your point of view to solve conflict.

By Ganesh Sitaraman and Anne L. Alstott

Related imageThe struggle between capitalism and socialism is back. “America will never be a socialist country,” President Trump tells us, even as Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez champion democratic socialism. At the same time, a consensus is growing — from Ray Dalio, the billionaire hedge fund manager, to Joseph Stiglitz, the economist and Nobel winner — that capitalism needs major reforms if it is going to survive. Perhaps surprisingly, given the trend toward the privatization of public services over the last generation, American history offers a way forward: the public option.

Most Americans probably associate the idea of a public option with health care. When the Affordable Care Act was debated in 2010, proponents of a public option wanted anyone to be able to buy into a government health insurance option like Medicare that would compete with private health insurance plans. But the public option isn’t a recent policy innovation, it isn’t limited to health care and, historically speaking, it hasn’t even been particularly controversial as an approach to public policy.

The public option isn’t a recent policy innovation, it isn’t limited to health care and, historically speaking, it hasn’t even been particularly controversial as an approach to public policy.

Americans love public options and have relied on them for hundreds of years. We just don’t usually think of them with that label. A public swimming pool is a public option; many people have private swimming pools. A public library is a public option; many universities have private libraries. Public parks, public schools, public defenders in courtrooms — the list goes on. They are all public options, government provisions of goods and services that coexist with the private marketplace.

Throughout our history, Americans have turned to public options as a way to promote equal opportunity and reconcile markets with democracy. For example, public libraries allow anyone to read, check out books or surf the internet. This expands educational opportunities and guarantees access to information to everyone, but it doesn’t prevent people from buying books at the bookstore if they choose.

Public options also benefit competitive markets and make capitalism work better. Public options in the form of public schools guarantee that we have an educated work force, and services like public transit and the post office support economic activity. The public option also competes in the marketplace with private options, expanding choices for consumers and acting as a check on monopoly power in concentrated sectors.

Chattanooga, Tenn., a city with a population of about 180,000, has had a public option for high speed internet since 2010, and today more than 100,000 residents and businesses take advantage of it.

The public option can provide a way forward for an America that is torn between our urgent need for greater equality and the benefits of markets. Consider broadband internet. More than a quarter of Americans in rural areas lack access to even moderate-speed internet. Nationwide, almost half of neighborhoods have only one option for high-speed internet; 36 percent have no options at all. A public option can go a long way in expanding access while introducing healthy competition.

Political leaders and policymakers are noticing that public options can help reform capitalism without abandoning markets. There are proposals for a public option for basic bank accounts run through the Postal Service or the Federal Reserve. These basic accounts would connect millions to the financial system and could include services like direct deposit, which would help account holders avoid the fees associated with the check-cashing industry.

The 2020 Democratic presidential primary already features a robust debate about moving toward a true public option in higher education so that post-high school training or college would be free for everyone. Proposals vary in the details, but they typically would increase funding and ensure that tuition is free (and sometimes room and board too) at public institutions — instead of leaving students with an increasing debt burden.

 And the idea that public action and markets are incompatible is simply false. We don’t have to choose between competitive markets and equal opportunity. Public options are a way to mitigate the damage that comes with the worst aspects of capitalism while creating a common fabric that ties us together.

Categories: Issues, Local, National

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