Would Gavin Newsom Gut Prop. 98 to Fund Single-Payer Health Care?

Lt. Gov. Gavin Newsom, likely the next governor of California, is a single-payer health care evangelist. He has a vision of the state under his charge leading “this conversation in a way that ultimately advances” a single-payer system nationwide.

Idealists like Newsom often talk about “guaranteed health care for all,” but not so much about the question of funding. This is, of course, because a universal, taxpayer-paid system will be impoverishingly expensive, a fact Newsom tacitly, and maybe just a bit inadvertently, acknowledged at a campaign stop over the summer.

During an August podcast interview with “Pod Save America,” Newsom explained that the cost of establishing a single-payer system in California “requires looking at things . . . looking to go to the voters to get approval on our constitutional set-asides for education dollars, Prop 98, Gann Limit, ERISA issues” because it will be so expensive.

Or in other words, a state-run health care system will be so costly that Sacramento must ask voters to tap into a portion of constitutionally guaranteed education funding to pay for it. This exposes the big lie from those who tell us that government can pay for anything if it will just keep raising taxes.

Newsom’s admission seems like it should have been big news. He’s telling us the single-payer dream of “Newsomcare” can’t come true unless Proposition 98, which is popular in the Golden State, is sacrificed.

He’s not wrong. Universal health care coverage in California would be a burden too far, projected to cost taxpayers $400 billion annually, roughly twice the state budget.

Prop 98, approved by voters in 1988, established a constitutional “minimum guarantee” of public education funding. Sacramento is continually tinkering with the calculations, but it mandates that a minimum of 40 percent of the state general fund must go toward education. In reality, the portion has been more like 50 percent. Though approved by just 51 percent of voters in 1998, it has since become a “sacred cow” in California politics. The Los Angeles Times describes it as “a stone fortress, a bastion of public policy under the watchful eye of a potent political army.”

Newsom doesn’t have to go to the voters if he wants to undermine Prop 98, though. He could simply go to the California Legislature, which can suspend it with a two-thirds vote, but that is a politically toxic vote for any legislator. Prop 98 has been suspended before, twice, in fact. But a Republican was in the governor’s office on both occasions, and the state was facing a massive budget deficit each time. We wonder how it would turn out if a Democrat made the pitch to the Democrat-dominated chambers.

Even if the Legislature — or the voters — approved diverting education funds to single-payer, it would still need several hundred billion dollars from other sources. There are also the painful costs of rationed care, extended wait times, an inescapable physician shortage, and a lack of access to innovative medical treatments to consider.

Vermont, which has about 1/64 the population of California, couldn’t make a go of single-payer health care because the state couldn’t afford it, yet California’s most influential politicians such as Newsom insist that it can be done here. It’s a fantasy that needs to reeled in by the few who still have clear eyes.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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