7. What will shape the future of the U.S. economy

Lead:

The problem of "difficult and expensive medical treatment" is not unique to China's medical system, which is related to the medical services that can be paid, the medical needs of medical staff and the people. As a headache for global leaders, health care reform is equally tricky for the current China. Regardless of whether the "Austell's medical reform" can be carried out smoothly, it will become a reference for medical reform in China and other countries.

Late at night on November 7, 2009, the U.S. National Assembly voted 220 in favor to 215 against to pass a health care reform bill totaling more than $1 trillion. The problem of "difficult and expensive medical treatment" is not unique to China's medical system, which is related to the medical services that can be paid, the medical needs of medical staff and the people. As a headache for global leaders, health care reform is equally tricky for the current China. Regardless of whether the "Austell's medical reform" can be carried out smoothly, it will become a reference for medical reform in China and other countries. After all, China's health care reform, like the United States, wants to serve the general public.

Under the current U.S. health care system, a person's health insurance is usually obtained through an employment relationship, and if they lose their job, they will no longer be covered by this insurance. Although the social insurance system includes some medical benefits and relief measures, not every unemployed person is eligible, thus creating a vicious circle of sickness - unemployment - no health insurance - no money for treatment - terminal illness - hospitals having to use taxpayers' money for free treatment - increasing the deficit of the State budget. Like "timing", this problem, if left unaddressed, could lead to the complete collapse of individuals, households, businesses, and national economies at any time.

According to relevant surveys, the annual medical expenditure of the United States reaches 2.2 trillion US dollars, equivalent to 7,471 US dollars per person, accounting for 16% of the gross national product, and this proportion is expected to reach 25% in 2025. President Ma has repeatedly warned that the current health care system is no longer sustainable and that there is no other way out than reform.

If implemented successfully, 96 percent of Americans' citizens under the age of 65, including the 36 million people who currently do not have health insurance, would have access to health insurance, which could ultimately reduce the federal deficit by $30 billion.

**The starting point of the hope to achieve universal health care is good, but there is no such thing as a free lunch. It is not difficult to find out the heavy burden that this health care reform plan will bring to the US economy.

The House of Representatives' health care reform package is expected to cost $894 billion over the next 10 years, but the Congressional Budget Office estimates that the final package will cost $1.2 trillion, exceeding the limit set by Obama**. Where does the money come from? In the United States, which has not yet emerged from the shadow of the financial crisis, this issue has become the biggest question for the opposition to health care reform.

The House of Representatives' plan is to be self-burdened and not to further exacerbate the federal fiscal deficit. This is one of the main reasons why Obama supports this plan. First, over the next 10 years,** taxes will be raised for individuals earning more than $500,000 a year and households earning more than $1 million a year. Additional taxes for the wealthy will be reflected in capital interest and stock gains. It is expected that by 2011, the capital interest tax will rise from the current 15% to 25.4%, and the stock gains tax will rise from 15% to 45%. Second, more than $400 billion in spending cuts on existing ** projects.

In addition, $20 billion could be raised from manufacturers of medical supplies, as well as fines for individuals who did not comply with the regulations and for employers who did not provide health insurance. Still, the massive spending is testing the nerves of American taxpayers and businesses, and has become the biggest obstacle in Obama's path to health care reform.

During the Clinton era, the health care reform efforts led by First Lady Hillary Clinton fell short, becoming the biggest setback in the US health care reform process, and also brought major political losses to Clinton and the Democratic Party. As Obama's flagship policy, if the health care reform plan fails again, the negative impact on Obama can be imagined. Therefore, Obama** is also trying to win the support of various interest groups, including drug manufacturers and medical professionals, and even adopts the method of "exchange of interests" in the process.

According to an article in the United States, in addition to trying to reach a consensus with Republicans, Obama is also actively courting some interest groups in the Democratic Party that oppose the health care reform plan, and the labor union is one of them. Although union members make up only 75 percent of the private sector workforce, they are an important force to be reckoned with within the Democratic Party.

In September 2009, Obama announced that he would impose punitive tariffs on all small car and light truck tires imported from China, which was seen both domestically and internationally as a signal of rising trade protectionism, and was not only condemned by China, but also strongly opposed by all sectors in the United States.

Gary Haverbauer, a senior scholar at the Peterson Institute for International Economics in the United States, commented on the incident, saying that to win the political battle over the health care reform plan, Obama must compromise with the pro-labor group Democrats, who support a strong stance on China. Famous American journalists Roberts and Steve Roberts also published an article saying that Obama's decision on the special insurance case for Chinese tires has only one reasonable explanation, that is, he hopes that the labor union will help promote the passage of the health care reform plan in Congress.

In addition to trade, the impact of health care reform on the U.S. economy is also seriously affected at home and abroad. As of November 2009, the economic recovery remained fragile, with high unemployment and a stagnant credit rating. The economic downturn means that fiscal revenues are reduced, and the increase in spending is tantamount to "adding insult to injury".

In fiscal year 2009 (from October 1, 2008 to September 30, 2009), the U.S. federal deficit hit an all-time high of $1.42 trillion, or about 10% of gross domestic product. Heading into fiscal 2010, the U.S. fiscal deficit rose to $176.4 billion, well above economists' expectations of $150 billion. Obama** previously estimated that the total size of the US fiscal deficit will reach $9.1 trillion in the next 10 years, and the scale of the deficit will undoubtedly increase further after the adoption of the new health care policy.

In the face of such a large fiscal deficit, Obama** promised that health care reform would not put more burdens on the country's economy and people's lives, which is inevitably questioned. According to the Washington Post, the high cost of health care reform will inevitably be passed on to the average consumer.

Compared with the U.S. health care reform, China's health care reform has received unanimous support from the whole country, but the problems it faces are equally complex. The medical reform carried out by these two large countries with completely different political systems will undoubtedly provide a useful reference for the medical reform of different countries in the world.