Why the Bailout Won’t Have to Compete With Medicare or Universal Coverage

From Uwe Rinehardt, economist from Princeton University, who specializes in healthcare

During last Friday’s presidential debate between John McCain and Barack Obama, the moderator, Jim Lehrer, asked both whether, in light of the proposed $700 billion Wall Street bailout, they would have to modify their campaign promises — including domestic spending on new health programs. Both candidates seemed flummoxed by the question and both clumsily evaded it.

The correct answer to this question is that they should not have to do so, at least in this emergent case. It all has to do with how the $700 billion is accounted for on the government’s balance sheet.