by Calculated Risk on 2/07/2006 07:46:00 PM

Economics Professors Andrew Samwick and Mark Thoma discuss retirement and health insurance in today's WSJ econoblog: Stitching a New Safety Net.

Dr. Polley's take on the debate:

I really enjoyed reading this Econoblog, and I'll tell you why. Mark Thoma and Andrew Samwick do an outstanding job of showing the Wall Street Journal readers how economists can have a debate on a controversial subject like this. The reader can clearly identify the points of agreement and disagreement. Mark nails the question: How much social insurance should be provided by the government and how much should be provided by markets. They both note the market failures in health insurance. Samwick calls attention to the way the tax code distorts the private insurance market. By identifying the questions and highlighting specific economic issues of incentives, efficiency, and equity, they generate a lot of light and surprisingly little heat.

I believe the two most pressing financial problems facing America are the structural General Fund deficit and health care. This discussion provides an excellent starting point for any debate on reforming health care.