Federal entitlement programs are strewn throughout the pages of U.S. history, springing from the noble purpose of assisting people who are destitute through no fault of their own. Yet as federal entitlement programs have grown, so too have their inefficiency and their cost. Neither tax revenues nor revenues generated by the national economy have been able to keep pace with their rising growth, bringing the national debt to a record peacetime level. The High Cost of Good Intentions is the first comprehensive history of these federal entitlement programs. Combining economics, history, political science, and law, John F. Cogan reveals how the creation of entitlements brings forth a steady march of liberalizing forces that cause entitlement programs to expand. This process—as visible in the eighteenth and nineteenth centuries as in the present day—is repeated until benefits are extended to nearly all who could be considered eligible, and in turn establishes a new base for future expansions. His work provides a unifying explanation for the evolutionary path that nearly all federal entitlement programs have followed over the past two hundred years, tracing both their shared past and the financial risks they pose for future generations.

In the United States, the size and composition of the federal budget is arguably the most important single issue of the 1990's, yet most debates and commentaries on the subject are largely uninformed. Virtually no one - whether government official, member of Congress, journalist, or taxpayer - seems to understand how the budget is put together and what it means. This is hardly surprising, since the budget has become extraordinarily complicated. The structure of the budget reform act of 1911 has been maintained, with the changes of additional reforms (1974, 1986, and 1990) piled on top of it, while virtually nothing has been discarded. Most people are distressed at the enormous size of the federal deficit and perplexed because highly touted plans and agreements to bring the deficit down result in an even higher deficit. Why does this happen? Why is there a growing deficit amid cries of underfunding? Why is there general agreement on a format that has proved so misleading? This book comprises a series of essays about the federal budget - how and why it has grown so large, why most "deficit-reduction" measures are either shams or predestined to fail, and why understanding budget issues is so difficult. The authors offer a new perspective, a microbudgeting approach, which requires examining in detail how the federal government makes its budget decisions. Macrobudgeting, which is concerned with totals rather than parts, has prevailed for more than a generation in both Democratic and Republican administrations; the deficit-reduction drives of the 1980's, for example, failed because the parts added up to more than the targeted totals. By contrast, microbudgeting breaks the budget down into its basic elements, carefully reviews the assumptions underlying each program or account, and critically examines the methods by which savings are computed. Using this approach, the authors demonstrate that it is possible to understand the budget process and to make informed decisions on issues of public policy. Individual essays focus on such topics as: the changing Congressional budget processes that have been critically important in contributing to the federal budget deficits that have persisted since World War II; the origins, uses, and abuses of budget baselines; and the myth of the budget reductions of the Reagan presidency.

America's health-care system is the envy of the world, but it faces serious challenges. The costs of care are rising rapidly, the number of uninsured Americans is at an all-time high, and public dissatisfaction is steadily increasing. How can we preserve the strengths of our current system while correcting its weaknesses? Three of America's leading health-care scholars answer that question in Healthy, Wealthy, and Wise. Poorly conceived federal tax policies, insurance regulations, and barriers to entry have distorted health-care markets and inhibited competition. John F. Cogan, R. Glenn Hubbard, and Daniel P. Kessler propose five key policies to build a better health-care system: (1) health-care tax reform, (2) insurance reform, (3) improvement of health-care information, (4) control of anticompetitive behavior, and (5) malpractice system reform. Together, these changes would harness the power of markets to deliver better health care to Americans. These reforms would strengthen consumers' ability to be cost- and value-conscious shoppers, while promoting quality and innovation in health care, pharmaceuticals, and medical technology. And, by cutting the cost of care by $60 billion per year, these reforms would make health insurance affordable for at least 6 million--and perhaps as many as 20 million--uninsured Americans.

Subsidies for health insurance for chronically ill, high-cost individuals may increase coverage in the broader population by improving the functioning of insurance markets. In this paper, we assess an historical example of a policy intervention of this sort, the extension of Medicare to the disabled, on the private insurance coverage of non-disabled individuals. We use data on insurance coverage from the Panel Study of Income Dynamics from before and after the extension of Medicare to the disabled to estimate the effect of the program on private insurance coverage rates in the broader population. We find that the insurance coverage of individuals who had a health condition that limited their ability to work increased significantly in states with high versus low rates of disability. Our findings suggest that that subsidizing individuals with high expected health costs is an effective way to increase the private insurance coverage of other high-cost individuals.

Health care in the United States has made remarkable advances during the past forty years. Yet our health care system also has several well-known problems: high costs, significant numbers of people without insurance, and glaring gaps in quality and efficiency—and the Patient Protection and Affordable Care Act of 2010 is not the answer. This second edition of Healthy, Wealthy, and Wise details a better approach, offering fundamental reform alternatives centering on tax changes, insurance market changes, and redesigning Medicare and Medicaid. The book proposes five specific reforms to improve the ability of markets to create a lower-cost, higher-quality health care system that is responsive to the needs of individuals, including increasing individual involvement, deregulating insurance markets and redesigning Medicare and Medicaid, improving availability and quality of information, enhancing competition, and reforming the malpractice system. The authors show that, by promoting cost-conscious behavior and competition in both private markets and government programs such as Medicare and Medicaid, we can slow the rate of growth of health care costs, expand access to high-quality health care, and slow down runaway spending.